This research investigates how observers react when they see someone else being given a compliment that is flattering but that appears sincere. Prior work suggests that to the extent the compliment is perceived to be genuine, observers will not judge the source negatively. Merging insights from social comparison research and dual attitudes theory, this article presents a novel conceptualization of observer reactions to flattery. Specifically, while observers' deliberative attitudes toward apparently sincere flattery may be positive, a spontaneous process of comparing oneself with the target will produce an implicit negative reaction rooted in the unpleasant sensation of envy. This conceptualization yields a host of related implications, successfully predicting observers' reactions toward insincere as well as sincere flattery and toward the flattery target as well its source, and also explaining how their envy-based negative reaction may ironically induce observers to behave in a manner consistent with the flatterer's interests. Convergent findings across four experiments provide a multifaceted understanding of observer reactions to flattery, while also informing the literature on social comparison and envy.