The mechanisms underlying the association between positive emotions and physical health remain a mystery. We hypothesize that an upward-spiral dynamic continually reinforces the tie between positive emotions and physical health and that this spiral is mediated by people’s perceptions of their positive social connections. We tested this overarching hypothesis in a longitudinal field experiment in which participants were randomly assigned to an intervention group that self-generated positive emotions via loving-kindness meditation or to a waiting-list control group. Participants in the intervention group increased in positive emotions relative to those in the control group, an effect moderated by baseline vagal tone, a proxy index of physical health. Increased positive emotions, in turn, produced increases in vagal tone, an effect mediated by increased perceptions of social connections. This experimental evidence identifies one mechanism—perceptions of social connections—through which positive emotions build physical health, indexed as vagal tone. Results suggest that positive emotions, positive social connections, and physical health influence one another in a self-sustaining upward-spiral dynamic.