Nicotine dependence continues to be a major public health problem worldwide and there is unequivocal evidence that genetics play a substantial role in its etiology. This review provides an overview of the evidence for genetic influences and recent advances in the field. Traditional quantitative genetics studies have revealed nicotine dependence is heritable and molecular genetics studies are providing increasing evidence that the genes responsible for nicotine’s pharmacokinetics and pharmacodynamics are particularly important. Despite considerable progress, a number of significant complexities and challenges remain. These include determining the specificity of genetic influences and clarifying the role of interactive contributions. One promising strategy for addressing these issues is an intermediate phenotype approach that attempts to identify the intervening proximal mechanisms that confer differential genetic risk. Understanding these mechanisms may permit more precision in understanding genetic influences and may also identify novel targets for intervention or prevention.