This study aimed to examine the impact of sustainable urban design and development on citizens’ happiness and urban quality of life in Sarab City. A descriptive–correlational survey design was employed. The statistical population consisted of residents aged 15–64 in Sarab (N=39,742), from which a sample of 380 individuals was selected using simple random sampling based on Cochran’s formula. Data were collected through three standardized questionnaires: Sustainable Urban Development (17 items), Oxford Happiness (29 items), and Urban Quality of Life (45 items). Content validity was verified by experts, and reliability coefficients ranged from 0.778 to 0.962 using Cronbach’s alpha. Data analysis included the Kolmogorov–Smirnov test, Pearson correlation, and multiple linear regression. The results indicated a significant positive effect of sustainable urban development on both happiness (R=0.242, P<0.001) and urban quality of life (R=0.734, P<0.001). Multiple regression analysis showed that sustainable urban development explained 53.9% of the variance in urban quality of life, compared to 5.7% for happiness. Among the components of sustainable development, the social dimension was the strongest predictor of urban quality of life (Beta=0.480), followed by the economic (0.295) and environmental dimensions (0.218). The findings confirm that sustainable urban development significantly enhances both happiness and urban quality of life among residents of Sarab, with the social dimension playing the most influential role; therefore, strengthening social, economic, and environmental components is essential for achieving sustainable urban well-being.