State-trait consistency and valence principles were integrated within a dynamic self-regulatory framework to predict interactive effects of state affect, trait affect and task demands on performance. State affect and performance were measured repeatedly as individuals completed a complex and dynamic decision-making task. Task demands were manipulated at the within-person level. The beneficial effect of state positive affect was strongest for individuals with high trait positive affect; however this effect was only evident under high task demands. The detrimental effect of state negative affect was weakest for individuals with high trait negative affect, with this effect being constant across task demand levels. This study demonstrated that state-trait inconsistency can be bad for individuals with high trait positive affect and consistency can be good for individuals with high trait negative affect. © 2013 Springer Science+Business Media New York.