Musical emotions, such as happiness and sadness, have been investigated using instrumental music devoid of linguistic content. However, pop and rock, the most common musical genres, utilize lyrics for conveying emotions. Using participants’ self-selected musical excerpts, we studied their behavior and brain responses to elucidate how lyrics interact with musical emotion processing, as reflected by emotion recognition and activation of limbic areas involved in affective experience. We extracted samples from subjects’ selections of sad and happy pieces and sorted them according to the presence of lyrics. Acoustic feature analysis showed that music with lyrics differed from music without lyrics in spectral centroid, a feature related to perceptual brightness, whereas sad music with lyrics did not diverge from happy music without lyrics, indicating the role of other factors in emotion classification. Behavioral ratings revealed that happy music without lyrics induced stronger positive emotions than happy music with lyrics. We also acquired functional magnetic resonance imaging data while subjects performed affective tasks regarding the music. First, using ecological and acoustically variable stimuli, we broadened previous findings about the brain processing of musical emotions and of songs versus instrumental music. Additionally, contrasts between sad music with versus without lyrics recruited the parahippocampal gyrus, the amygdala, the claustrum, the putamen, the precentral gyrus, the medial and inferior frontal gyri (including Broca’s area), and the auditory cortex, while the reverse contrast produced no activations. Happy music without lyrics activated structures of the limbic system and the right pars opercularis of the inferior frontal gyrus, whereas auditory regions alone responded to happy music with lyrics. These findings point to the role of acoustic cues for the experience of happiness in music and to the importance of lyrics for sad musical emotions.