Post lower blepharoplasty bag when I smile. Is this skin or muscle? (Photo)

Thank you for sharing your case and photos.  You have had the right amount of skin removed with surgery.  The bunching you see is from the underlying orbicularis oculi muscle. Some residual muscle is necessary to help you close your eyes and blink.  There are several options to treat this including surgery or Botox.  Consider a consultation with a board certified oculoplastic surgeon to discuss your options.  Good luck!

There are a few issues here. At rest you don't appear to have redundant skin, so there is probably not much excess that could be removed or you might get an ectropion.  It looks like you had fat removed, so you are volume deficient.  This increases the amount of wrinkling when you smile.  Adding filler to the lower lid may help.  You could also do some laser resurfacing to try to improve the skin texture. Botox to the orbicularis will help soften the muscle roll you see under the lashes when  you smile. When people have a very large muscle here, a small amount of it can sometimes be removed.  If too much is taken it can affect your lid tone and blinking.    

You can tailor a muscle roll, reduce lower eyelid skin laxity and move up the we cheek junction with a superficial cheek lift.