PurposeThe age-old controversial doctrine the ‘unity of virtue and happiness’ (UVH) seems reviving in positive psychology (PP), when PP claims to demonstrate that positive traits, i.e. character strengths and virtues, play a decisive role in promoting authentic happiness. The author argues that people concerned with character education (CE) should inquire into PP’s arguments about the relation between virtue and happiness because they can respond to the questions ‘why be virtuous’ and ‘why is virtue worth pursuing’. These fundamental issues are seldom addressed by contemporary CE discourses. Accordingly, this paper is aimed to analyse PP’s conceptions of virtue and happiness, to examine PP’s elaboration on the relationship between virtue and happiness, and finally, to revisit and draw important implications the doctrine of UVH has for contemporary CE from the perspective of PP. Design/methodology/approachThis study belongs to philosophy of education in nature and the major methods applied are conceptual analysis, argument analysis, and implication interpretation. Certain core concepts involved in the relationship between virtue and happiness developed by PP are analysed by investigating their respective connotations and their relations. Next, an argument analysis is conducted on PP’s argument for UVH. Finally, some important implications for contemporary CE are derived from this new interpretation of UVH. FindingsAfter an examination of PP’s argument for UVH, it is found that, given the different conceptions of virtue held by PP and CE, PP’s promise to provide a theoretical framework for design of character development programmes cannot be kept. Nonetheless, PP’s conception of virtue in a broad sense urges us to reconsider what good character amounts to and whether it is appropriate to conceive of good character in a purely ethical sense, where CE is currently proceeding. The author points out that the CE proposed by The Jubilee Centre for Character & Virtues, University of Birmingham, UK, is developed in the new direction of PP. Besides, the concept of signature strength helps to illustrate a missing piece of the puzzle of contemporary CE, the idea of character individualisation. Originality/valueThe distinctive value of this study lies in revealing the fact that cultivating virtue to achieve happiness, the central thesis of the new character science PP, is in actuality in tune with the philosophical doctrine of UVH proposed by ancient eudaimonism. For that matter, it is shown that both philosophical wisdom and scientific knowledge are interested in the intricate relationship between virtue and happiness. Recommendations for Educational Policy / Implications in PracticeTwo important implications it has for CE are to be noted. Firstly, with regard to the teaching of CE, PP’s elaboration on the value of virtue cultivation and exercise for personal happiness helps to make up for the deficient tendency to instrumental arguments that current support for contemporary CE has. In response to students’ queries ‘why be virtuous’ and ‘why is virtue worth pursuing’, personal happiness is arguably an answer. Secondly, in terms of educational policy, the much richer list of character strengths made by PP compels us to reconsider what a good character amounts to and specifically whether it is complete and appropriate for contemporary CE to simply centre on inculcation of moral virtues. In this regard, the new version of CE proposed by The Jubilee Centre for Character & Virtues, University of Birmingham, UK is an important point of reference.