This study focuses on work engagement (WE) as the mediator that contributes to individual work performance (IWP) in organisations. The two independent variables: positive emotion and work engagement, are discussed in this research. Work engagement also acts as a mediator variable. Altogether, 169 employees from the banking industry in the Klang Valley and Peninsular Malaysia responded to the self-administered questionnaires. We used the Self-Determination Theory to examine the relationships between positive emotions, work engagement, and individual work performance. Based on Structural Equation Modelling-Partial Least Squared (SEM-PLS), findings from this study indicated that positive emotions positively predict work engagement and individual work performance. Another finding is that work engagement partially mediated the relationship between positive emotions and individual work performance. Overall, the findings of this research suggest that organisations must understand the predictors of work engagement, such as emotions, which can then aid them to improve their employees’ individual work performance.