Despite a great deal of progress, more than 10% of pregnant women in the USA smoke. Epidemiological studies have demonstrated correlations between developmental tobacco smoke exposure and sensory processing deficits, as well as a number of neuropsychiatric conditions, including attention deficit hyperactivity disorder. Significantly, data from animal models of developmental nicotine exposure have suggested that the nicotine in tobacco contributes significantly to the effects of developmental smoke exposure. Consequently, we hypothesize that nicotinic acetylcholine receptors (nAChRs) are important for setting and refining the strength of corticothalamic-thalamocortical loops during critical periods of development and that disruption of this process by developmental nicotine exposure can result in long-lasting dysregulation of sensory processing. The ability of nAChR activation to modulate synaptic plasticity is likely to underlie the effects of both endogenous cholinergic signaling and pharmacologically administered nicotine to alter cellular, physiological and behavioral processes during critical periods of development.