Increased use of artificial intelligence service agents (AISA) has been associated with improvements in AISA service performance. Whilst there is consensus that unique forms of attachment develop between users and AISA that manifest as parasocial relationships (PSRs), the literature is less clear about the AISA service attributes and how they influence PSR and the users' subjective well-being. Based on a dataset collected from 408 virtual assistant users from the US, this research develops and tests a model that can explain how AISA-enabled service influences subjective well-being through the mediating effect of PSR. Findings also indicate significant gender and AISA experience differences in the PSR effect on subjective well-being. This study advances current understanding of AISA in service encounters by investigating the mediating role of PSR in AISA's effect on users' subjective well-being. We also discuss managerial implications for practitioners who are increasingly using AISA for delivering customer service.