Memory is often better for emotional rather than neutral stimuli. The benefit for emotional items could be the result of an associative mechanism whereby items are associated to a slowly updating context. Through this process, emotional features are integrated with context during study, and are reactivated during test. The presence of emotion in context would both provide a stronger retrieval cue, enhancing memory of emotional items, as well as lead to emotional clustering, whereby emotionally similar items are recalled consecutively. To measure whether associative mechanisms can explain the enhancement for emotional items, we conducted a free recall study in which most items were emotionally neutral to minimize effects of mood induction and to more closely reflect naturalistic settings. We found that emotional items were significantly more likely to be recalled than neutral items and that participants were more likely to transition between emotional items rather than between emotional and neutral items. Together, these results suggest that contextual encoding and retrieval mechanisms may drive the benefit for emotional items both within and outside the laboratory.