In this study we try to explain the difference in subjective well-being between citizens who self-identify as a member of an ethnic minority group and citizens who describe themselves as a member of the majority population. We use data from twenty countries that are represented in the fifth edition of the European Social Survey, with more than 1,500 ethnic minority respondents and 36,000 respondents in total. Though initially majority-minority differences in both life satisfaction and happiness can be observed, with ethnic minority respondents having lower levels, these differences can be fully explained by the fact that ethnic minority respondents occupy relatively disadvantaged socio-economic positions and experience more discrimination i...