Older adults often demonstrate pronounced difficulties in memory binding, leading to an age-related source memory deficit. Our study aimed to examine whether this deficit could be alleviated by using emotional sources and self-referencing (SR) encoding strategies. In an online experiment, 106 younger and 102 older adults were presented with smiling, sad-looking, and neutral faces as sources, paired with neutral sentences as items. Participants encoded these either through self-referencing (SR) or a control encoding strategy. Source memory performance was assessed using a multinomial model. Results indicated that emotional sources improved source memory for both younger and older adults, but only in the SR condition. No effect of emotion on source memory was observed in the control condition. Contrary to expectations, SR enhanced source memory only in younger adults but not in older adults. It is possible that the SR instructions used in this study were more complex and cognitively demanding than those in previous research, diminishing their potential memory-enhancing effect in older adults. Future research should thus explore simpler SR strategies to determine their efficacy in older adults’ source memory.