In this paper, we examine whether affect influences higher level cognitive processes. We review research on the effect of emotion on interpretation, judgement, decision making, and reasoning. In all cases, we ask first whether there is evidence that emotion affects each of these processes, and second what mechanisms might underlie these effects. Our review highlights the fact that interpretive biases are primarily linked with anxiety, while more general mood-congruent effects may be seen in judgement. Risk perception is also affected by (...) negative and positive affect. Research shows complex effects of emotion on decision making and reasoning, with emotion sometimes hindering normatively correct thinking and sometimes promoting it. There are also important effects of emotion on reasoning style. We discuss key differences between the effects of incidental affect (feeling states not related to the semantic contents of the cognitive task) and integral affect (where the feeling state is caused by or linked to the contents of the cognitive task). In the conclusion, we suggest that focusing on some of the constituent mechanisms involved in interpretation, judgement, decision making and reasoning provides a way to link some of the diverse findings in the field. We also highlight important areas for future research. (shrink)