Our mood really changes the way we see the world, according to a new study from a team at the University of Toronto. "Good and bad moods literally change the way our visual cortex operates," explains Adam Anderson, a psychologist who worked on the research. When we're in a good mood, "our visual cortex takes in more information," he says, "while negative moods result in tunnel vision."
The researchers showed volunteers a composite image (pictured here) that had a face in the center and a house in the background, and they focused the volunteers' attention on the face by asking them to identify the gender. Participants who were primed to be in a bad mood did fine on that task, but didn't process the surrounding image of the house. Those who were in a good mood took in more information and processed more of the picture—both the face and the background.
As Taylor Schmitz, a U of T graduate students and the study's lead author, notes:

Good moods enhance the literal size of the window through which we see the world. The upside of this is that we can see things from a more global, or integrative perspective. The downside is that this can lead to distraction on critical tasks that require narrow focus, such as operating dangerous machinery or airport screening of passenger baggage. Bad moods, on the other hand, may keep us more narrowly focused, preventing us from integrating information outside of our direct attentional focus.