It's happiness mixed with anticipation, and sometimes nervousness. When Christmas is just a few days away, and a child thinks he might be getting something special (like a bicycle or Super Nintendo), he'll be excited and probably will have trouble sleeping because he can't wait to get his present.
Or suppose you've entered a contest, and they're about to announce the winner. You are happy because you're pretty sure you've won a prize, but you're also nervous because there's a chance that you didn't. That's also what it feels like to be excited.