Light has a critical impact on mood disorders in ways we are only beginning to recognize, with the potential for the development of effective, relatively non-invasive therapies. However, until now, surprisingly little has been reported on the mechanisms underlying the effects of light on mood. We characterize a newly discovered pathway that links specialized retinal photoreceptors, the dorsal thalamus, and the prefrontal cortex. This pathway apparently mediates the diverse effects of diffuse light intensity on mood. We dissect the synaptic input properties, behavioral output, and mechanistic basis of this new pathway, with special emphasis on its contribution to the pathophysiology of depression. To this end, we combine complementary behavioral, electrophysiological, functional imaging, and genetic manipulation approaches. This study, we hope, will pave the way toward a new understanding of the effect of light on mood, which can have implications both for research and in the clinic.