Cigarette smoke is a major health risk factor which significantly increases the incidence of diseases including lung cancer and respiratory infections. However, there is increasing evidence that smokers have a lower incidence of some inflammatory and neurodegenerative diseases. Nicotine is the main immunosuppressive constituent of cigarette smoke, which inhibits both the innate and adaptive immune responses. Unlike cigarette smoke, nicotine is not yet considered to be a carcinogen and may, in fact, have therapeutic potential as a neuroprotective and anti-inflammatory agent. This review provides a synopsis summarizing the effects of nicotine on the immune system and its (nicotine) influences on various neurological diseases.