We propose a biologically inspired model of olfactory processing for chemosensor arrays. The model captures three functions in the early olfactory pathway: chemotopic convergence of receptor neurons onto the olfactory bulb, center on-off surround lateral interactions, and adaptation to sustained stimuli. The projection of ORNs onto glomerular units is simulated with a self-organizing model of chemotopic convergence, which leads to odor specific spatial patterning. This information serves as an input to a network of mitral cells with center on-off surround lateral inhibition, which enhances the initial contrast among odors and decouples odor identity from intensity. Finally, slow adaptation of mitral cells adds a temporal dimension to the spatial patterns that further enhances odor discrimination. The model is validated using experimental data from an array of temperature-modulated metal-oxide sensors.