Cognitive models of depression posit that biased emotional processing contributes to the maintenance of depression. Specifically, depression has been associated with biased attention and memory for emotional information; however, few studies have examined relations between these processes. In the current study, stably dysphoric (n = 23) and non-dysphoric (n = 40) participants’ line of visual gaze was assessed while viewing a 2 × 2 array of emotionally valenced words. Incidental recognition of study stimuli was then assessed. Non-dysphoric individuals demonstrated an attentional bias for positive words, while dysphoric individuals lacked this bias. Further, fixation duration and time spent viewing positive stimuli mediated the association between dysphoria status and incidental recognition of positive words. Results suggest that a “protective bias” to focus on positive stimuli, typically observed among non-dysphoric individuals, is absent in dysphoria.