I'm sure you are saying "Happy what???" Also known as St. Lucy's Day, it was a Church feast day together with Advent, marking the beginning of the Christmas season. Before the reform of the Gregorian calendar, it also marked the longest night of the year. This is probably the reason why the tradition has lived on in the Scandinavian countries, since the nights in the winter are very dark and long and the idea of light overcoming darkness is appealing.
The meaning of Lucy or Lucia is "light" stemming from the Latin-"lux." In one of the stories associated with her legend, she was working to help Christians hiding in the catacombs. In order to bring with her as much food and drink as possible, she needed to have her hands free. She solved this problem by making a wreath to wear on her head on to which she attached lights. Thus she managed to see in the darkness of the catacombs.
As the tradition goes, the eldest daughter of the family dresses in white and wears a candle wreath while serving a sweet roll and coffee to her parents. Now, for some reason in my family, it was the 2nd daughter. I think Candace served it one year in a white dress with the actual candle wreath, although not lit. Our family typically makes this bread (which we call Christmas Bread) for gifts to family friends and then we also have a loaf for Christmas morning.
This is not really a hard bread to make, but it is quite involved making many dishes dirty and 2 risings. Today I delivered my last batch. That was 16 loaves and I still need to make one for our family to enjoy.
Even if this day has roots in pagan celebrations of the solstice, think again. As you see light this Christmas season, may you remember that it is Jesus that comes to overcome the darkness and illuminate us.