What determines Morale
 

Most of my troops have low Morale and I don't know why. I know how Morale affects your guys...I just don't know what is the cause of low/high morale.

Some items and mixing stacks from different races, eg. Elves and Dwarves will lower eachother morale, because they hate eachother, undead mixed with living creatures also lowers morale to the living etc.

Open the choosen unit window. Then move your mouse cursor over the morale icon. There is a pop up window showing what is buggering your unit.