Nicomachean Ethics I.7b

Life seems to be common even to plants, but we are seeking what is peculiar to man. Let us exclude, therefore, the life of nutrition and growth.

Aristotle is seeking the telos of human life, the point of the thing. He is therefore excluding what we have in common with lower forms of life, and looking for something unique to ourselves. Mere nutrition-seeking and growth is something we have in common with all forms of life; it's not therefore despicable, and indeed is the definition of life. It is not, however, a candidate for the purpose of the best human life: that requires finding our highest capacities, and fulfilling them.

Next there would be a life of perception, but it also seems to be common even to the horse, the ox, and every animal.

Philosopher Hans Jonas, mentioned in the second link, points out that it isn't quite 'common'; predators have much higher degrees of perception than prey animals. If you find an animal that can smell water and see green plants and perhaps detect motion near itself, it is prey. If you find the eyes of an eagle, you found a killer. 

That may be significant to natural theology; Aristotle doesn't go into it, however, so we will pass it for now. 

There remains, then, an active life of the element that has a rational principle; of this, one part has such a principle in the sense of being obedient to one, the other in the sense of possessing one and exercising thought. And, as 'life of the rational element' also has two meanings, we must state that life in the sense of activity is what we mean; for this seems to be the more proper sense of the term.

This is a response to his own objection that merely possessing unused virtues wasn't a candidate for the best life; you have to do something with them for it to count. 

Now if the function of man is an activity of soul which follows or implies a rational principle, and if we say 'so-and-so-and 'a good so-and-so' have a function which is the same in kind, e.g. a lyre, and a good lyre-player, and so without qualification in all cases, eminence in respect of goodness being added to the name of the function (for the function of a lyre-player is to play the lyre, and that of a good lyre-player is to do so well): if this is the case, and we state the function of man to be a certain kind of life, and this to be an activity or actions of the soul implying a rational principle, and the function of a good man to be the good and noble performance of these, and if any action is well performed when it is performed in accordance with the appropriate excellence: if this is the case, human good turns out to be activity of soul in accordance with virtue, and if there are more than one virtue, in accordance with the best and most complete.

Emphasis added and deserved. That's it: that's the definition of "happiness" that tells you how to live the best life. The word is eudaimonia in the Greek, 'eu' meaning 'good' and 'daimon' being a personal soul-like entity that the Ancient Greeks believed in. 

The word for 'virtue' is aretḗ, which really doesn't mean 'virtue' in the sense of the English word: it means excellence. In Latin 'vir-' implies a kind of manliness; that isn't present in the Greek. 

What he's telling you is this: happiness is an activity, and the particular activity it is proves to be seeking excellence with all your vital powers. That means that you can choose to be happy, or not; and the road to happiness is clearly marked out if you want it. This is one of the most important lessons in all of human history, in all of philosophy. Somehow we fail to convey it to our children. No one once said those words to me until Iakovos did when I was a senior in my undergraduate studies. 

But we must add 'in a complete life.' For one swallow does not make a summer, nor does one day; and so too one day, or a short time, does not make a man blessed and happy.

This is an important point, and one he explores further in Politics III:  "These are conditions without which a state cannot exist; but all of them together do not constitute a state, which is a community... for the sake of a perfect and self-sufficing life. Such a community can only be established among those who live in the same place and intermarry. Hence arise in cities family connections, brotherhoods, common sacrifices, amusements which draw men together. But these are created by friendship, for the will to live together is friendship. The end of the state is the good life, and these are the means towards it. And the state is the union of families and villages in a perfect and self-sufficing life, by which we mean a happy and honorable life."

We will hear a great deal more about friendship in the later books of the EN. It is also fundamental to the good life as he understands it.

Let this serve as an outline of the good; for we must presumably first sketch it roughly, and then later fill in the details. But it would seem that any one is capable of carrying on and articulating what has once been well outlined, and that time is a good discoverer or partner in such a work; to which facts the advances of the arts are due; for any one can add what is lacking. And we must also remember what has been said before, and not look for precision in all things alike, but in each class of things such precision as accords with the subject-matter, and so much as is appropriate to the inquiry. For a carpenter and a geometer investigate the right angle in different ways; the former does so in so far as the right angle is useful for his work, while the latter inquires what it is or what sort of thing it is; for he is a spectator of the truth. We must act in the same way, then, in all other matters as well, that our main task may not be subordinated to minor questions. Nor must we demand the cause in all matters alike; it is enough in some cases that the fact be well established, as in the case of the first principles; the fact is the primary thing or first principle. Now of first principles we see some by induction, some by perception, some by a certain habituation, and others too in other ways. But each set of principles we must try to investigate in the natural way, and we must take pains to state them definitely, since they have a great influence on what follows. For the beginning is thought to be more than half of the whole, and many of the questions we ask are cleared up by it.

Emphasis added. This is a restatement of I.3, which is of fundamental importance to understanding what follows.