Growing evidence indicates that gratefulness and gratitude are important for well-being and happiness. Yet, research to date has been hindered by a lack of conceptual clarity into the nature of these constructs. The present paper reviews existing literature and argues for a distinction between gratefulness and gratitude. While both gratefulness and gratitude are types of appreciative functioning and both involve benefit appraisals, only the latter concerns perceived agency. A set of triggers, moderating factors, and motivation and behavioural processes involved in gratefulness and gratitude are outlined, and differences are highlighted. From this vantage, it is argued that appreciative functioning can be adequately represented as a complex dynamic system, which involves a plurality of interacting processes. Some of these processes are common to gratefulness and gratitude and some are unique to each. The proposed conceptualisation of appreciative functioning spans aspects of attention, cognition, emotion, motivation and social behaviour, integrating the diverse approaches to gratefulness and gratitude taken in the literature. It is suggested that grateful dispositions can be understood as characteristic self-reinforcing patterns in which this complex system functions. The paper also highlights the need to measure gratitude and gratefulness more independently and to both qualitatively and quantitatively determine the unique contribution of the two constructs to well-being.