Nicotine addiction and alcohol dependence are highly comorbid disorders that are likely to share overlapping genetic components. We have examined two neuronal nicotinic receptor subunit genes (CHRNA4 and CHRNB2) for possible associations with nicotine and alcohol phenotypes, including measures of frequency of use and measures of initial subjective response in the period shortly after first using the drugs. The subjects were 1,068 ethnically diverse young adults participating in ongoing longitudinal studies of adolescent drug behaviors at the University of Colorado, representing both clinical and community samples. Analysis of six SNPs in the CHRNA4 gene provided modest support for an association with past 6 month use of alcohol in Caucasians (three SNPs with P < 0.08), but no evidence for an association with tobacco and CHRNA4 was detected. However, a SNP (rs2072658) located immediately upstream of CHRNB2 was associated with the initial subjective response to both alcohol and tobacco. This study provides the first evidence for association between the CHRNB2 gene and nicotine- and alcohol-related phenotypes, and suggests that polymorphisms in CHRNB2 may be important in mediating early responses to nicotine and alcohol.