Healthy sleep, positive general affect, and the ability to regulate emotional experiences are fundamental for well-being. In contrast, various mental disorders are associated with altered rapid eye movement (REM) sleep, negative affect, and diminished emotion regulation abilities. However, the neural processes mediating the relationship between these different phenomena are still not fully understood. In the present study of 42 healthy volunteers, we investigated the effects of selective REM sleep suppression (REMS) on general affect, as well as on feelings of social exclusion, cognitive reappraisal (CRA) of emotions, and their neural underpinnings. Using functional magnetic resonance imaging we show that, on the morning following sleep suppression, REMS increases general negative affect, enhances amygdala responses and alters its functional connectivity with anterior cingulate cortex during passively experienced experimental social exclusion. However, we did not find effects of REMS on subjective emotional ratings in response to social exclusion, their regulation using CRA, nor on functional amygdala connectivity while participants employed CRA. Our study supports the notion that REM sleep is important for affective processes, but emphasizes the need for future research to systematically investigate how REMS impacts different domains of affective experience and their neural correlates, in both healthy and (sub-)clinical populations.