The hotel is run by Pops, who does ask about payment methods, but offers option c: "Sneak out in the middle of the night... Very popular choice." Fozzie also makes the quip "if this is the "Happiness Hotel, then I'd hate to see what the sad one looked like!".
Residents of the hotel, introduced during the "Happiness Hotel" number, explicitly describing the place's flaws and merits, include Dr. Teeth and The Electric Mayhem (who live there between gigs, and have now stayed for five years), Scooter, Rowlf the Dog, Lew Zealand, Gaffer, chickens, and Sam the Eagle, amongst others. Staff, apart from Pops, seems to be limited to Rizzo the Rat and other rat bellhops, and The Swedish Chef (despite a song lyric claiming the kitchen no longer exists).
The exterior sign is faded and the paint is chipping, though a Union Jack still proudly waves outside. A double-decker omnibus, adorned with a Happiness Hotel sign as well as a life preserver, sits out front. The interiors are hardly an improvement, sporting many laundry lines, cobwebs, antique bric-a-brac, chairs with broken springs, broken lamps and peeling wallpaper. The bathroom is communal.
Despite all these poor conditions, the residents seem to be quite content with the hotel and have no problem singing about it.
The room assigned to Kermit and friends is, like the rest of the hotel, a somewhat dismal space, dominated by the Murphy bed, which is not scaled down and thus large enough for almost the entire cast to sit on when discussing how to foil Nicky Holiday's plans. The bed's singular characteristic, becoming a running gag, is its tendency to snap back into the wall at the most inopportune times. Almost immediately afterwards, the light bulb from the hanging lamp falls from its moorings and shatters on the floor.
- Pops, Dr. Teeth, Floyd Pepper, Animal, Janice, Lips, Zoot, Beauregard, Dr. Bunsen Honeydew, Beaker, Lew Zealand, The Swedish Chef, Rowlf the Dog, Scooter, Rizzo the Rat, Sam the Eagle, Lubbock Lou, Gramps, Bubba, Lou, Zeke, Slim Wilson, Crazy Harry, Annie Sue, Gaffer, Rats, Chickens, Louis Kazagger, the Newsman
- A portion of the Muppet store next to the Muppet*Vision 3D attraction in Walt Disney World is constructed to resemble the Happiness Hotel. The laundry hung across the second floor balcony includes Mickey Mouse's shorts.
- The Happiness Hotel appears as a location in Muppet RaceMania.
- An early screenplay draft for the film had Sam the Eagle in the role of the dwelling's hotel detective, dispensing such rules as "No elephants in your room after six o'clock."