Wonder, a social activist, was one of the main figures in the campaign to have the birthday of Martin Luther King Jr. become a national holiday, and created this single to promulgate the cause.

"Happy Birthday" was released as the fourth single of Wonder's Hotter than July (1980) album in June 1981.

The holiday, he proposes, would facilitate the realization of Dr. King's dreams of integration and "love and unity for all of God's children".

Wonder used the song to popularize the campaign, and continued his fight for the holiday, holding the Rally for Peace Press Conference in 1981.

United States President Ronald Reagan approved the creation of the holiday, signing it into existence on November 2, 1983.