Previous studies on the happiness levels of people in developing countries showed that urban areas had better healthcare conditions and residents were happier, whereas rural areas were more vulnerable and residents were less happy. Numerous studies have shown that residents of rural areas in developed countries are happier. However, a few studies have comprehensively examined the happiness of residents in rural areas of developing countries. Contrary to the aforementioned statement, people in rural areas may be happier, but this remains to be explored. During the COVID-19 pandemic, people worldwide showed clinically significant levels of depression, anxiety, and mental distress (Santomauro in Lancet 398(10312):1700–1712, 10.1016/S0140-6736(21)02143-72021, 2021). Upon lifting lockdown measures and recovering economic activity, primarily due to mass vaccination programs, knowledge about happiness regarding the recovery processes of this mental distress was not enough. Furthermore, a few studies evaluated the mental health and happiness of residents in the rural areas of developing countries during the pandemic. Based on this background, this study analyzed the reality of urban and rural happiness during the pandemic in Bali, a developing country, and aimed to show that rural residents were happier. Higher levels of happiness among rural residents observed in the first survey was confirmed using a second survey. Both chronological surveys were conducted in the same region using the same questionnaire halfway through the COVID-19 pandemic until the near-endemic period. This survey was conducted from June to July 2022. The responses of 280 people from the same districts as the first survey were quantitatively compared. Based on these data, we performed a simple analysis, comparison of means, factor analysis, multiple regression analysis, canonical correlation analysis, and covariance structure analysis. The survey results showed that rural areas did not outperform urban areas in terms of happiness itself. Additionally, happiness levels were mostly unchanged in both areas compared to the previous survey. Residents in rural areas showed decreased medical concerns, better income recovery, and limited patience compared to the earlier results. Alternatively, residents in urban areas showed increased anxiety about medical care, decreased income, and higher levels of loneliness and depression. In other words, the recovery of income and reduced concern about medical care in rural areas were in contrast to the low level of happiness. These results also point to lower levels of happiness among residents in urban areas. Therefore, the happiness recovery level following the pandemic appears better in rural areas and slower in urban areas. That is, the hypothesis was proven correct. Interestingly, the results of this study differ from those of previous studies, which report higher happiness levels among urban residents in developing countries and lower happiness levels among rural residents.