Nicotine is a strong activator of the hypothalamus pituitary adrenal (HPA) axis. Smoking of only two cigarettes consistently activates the HPA axis of habitual smokers. However, while being a habitual smoker only induces small changes of basal HPA axis activity, smoking induces an attenuated responsiveness of the HPA axis to psychological stress, but not to injection of corticotropin releasing hormone (CRH) or physiological load. The latter points to alterations at hypothalamic or other central structures. The further consequences of decreased HPA axis responsiveness are discussed. Chronic inflammation of the airways is a common consequence of habitual smoking, and smokers often present with low-grade systemic inflammation, which may be mediated by HPA axis alterations. However, habitual smokers' monocytes are reported to show an increased sensitivity towards the inflammation suppressing effects of cortisol, while on the one hand, inflammation of the airways appears to be relatively resistant towards glucocorticoid treatment. In conclusion, this pattern of attenuated cortisol responses and decreased glucocorticoid sensitivity may be causally related to disinhibition of inflammatory processes and thereby further stimulate adverse health outcomes, such as airway inflammation or atherosclerosis.