Bhutan, a small Buddhist kingdom in central Asia located in the eastern Himalaya is the happiest country in the world. Bhutan is also geographically land lock country situated in the south of Tibet and in the north of India with its smallest population of 820000 people with the total area of 38394 Sq. km. The state religion in Bhutan is Buddhism where, 59% of total population is Buddhist and among 25% of total Population are Hindus. Almost 2% total population is Christian. The present political system of Bhutan is known as Constitutional Democracy, where implementation and coordination of the rules and regulation of the country is done by Prime minister but the final approval of the decision making is done by the king. The main goal of the country is to pursue the happiness of the people. Therefore the Buddhist philosophy of Gross National Happiness is more important than the Gross Domestic Product. “How is Gross National Happiness measure in Bhutan?” is the repeated question from everyone. Happiness in Bhutan is always measured by the living standard of the people, income and assets. It is also measured by interviewing Bhutanese about their personal feelings and values. The happiness is also psychologically understood by their family well-being, life satisfaction, positive emotion and spirituality of individual. The philosophy of Gross National Happiness is introduced by the Forth king of Bhutan His majesty the 4th Druk Gyalpo, King Jigme Singay Wangchuk in 1972. Good governance, conversation of environment, preservation and promotion of cultural heritage and sustainable development are four main pillar of Gross National Happiness.