Several theories suggest that people differ significantly in their environmental sensitivity, defined as the capacity to perceive and process information about the environment. More sensitive people, who make up between 25 to 30% of the population, are not only more negatively affected by adverse experiences but also benefit disproportionately from positive ones, in line with Differential Susceptibility theory. They also appear to report stronger emotional responses to events than others. However, the current understanding of the relationship between sensitivity and the experience and processing of emotions remains limited. In the current paper we propose a new conceptual framework for the multiple ways in which environmental sensitivity may impact on different aspects of the experience and processing of emotions. This includes heightened perception of emotions, increased emotional reactivity as well as the important role of emotion regulation for the wellbeing of highly sensitive people. In addition, we also consider rearing experiences in shaping sensitivity and emotion regulation. The reviewed empirical studies largely support the conceptual model but more research is needed to explore the dynamics between sensitivity and emotions further. Finally, we discuss several implications for wellbeing before making a case for the inclusion of individual differences in environmental sensitivity in affective science.