Healthy adults show better memory for low-arousal positive versus negative stimuli, but depression compromises this positive memory advantage. Existing studies are limited by small samples or analyses that provide limited insight into underlying mechanisms. Our study addresses these concerns by using a multistaged analysis, including diffusion modeling, to identify precise psychological processes underlying the positive memory advantage and its disruption by depression in a large sample. A total of 1,358 participants completed the BDI-II (Beck et al., 1996) and an emotional memory task. At encoding, participants judged whether positive and negative words were positive or self-descriptive. After a free recall test, participants viewed an equal mix of studied and unstudied words and judged whether each was "old" or "new"; if judged "old," they indicated whether the study source was a valence or self-reference judgment. We replicate the positive memory advantage and its decrease in depression in recall, recognition, and source accuracy. The hierarchical drift diffusion model (HDDM; Wiecki et al., 2013) revealed that higher BDI-II scores are associated with more efficient evidence accumulation for negative words in the recognition and source memory tasks. By contrast, evidence accumulation for positive words is unaffected by BDI-II during the recognition task but becomes less efficient with increased BDI-II during the source memory task. In conclusion, in a well-controlled design with a large sample, we find that depression reduces the positive memory advantage. HDDM analyses suggest that this reflects differential effects of depression on the speed of evidence accumulation during the retrieval of positive versus negative memories. (PsycInfo Database Record (c) 2023 APA, all rights reserved).