Agricultural biomass burning (ABB) has been of particular concern due to its influence on air quality and atmospheric radiation, as it produces large amounts of gaseous and aerosol emissions. This paper presents an integrated observation of a significant ABB episode in Nanjing, China, during early June 2011, using combined ground‐based and satellite sensors (Moderate Resolution Imaging Spectroradiometer, Atmospheric Infrared Sounder, Cloud‐Aerosol Lidar and Infrared Pathfinder Satellite Observation (CALIPSO), and Ozone Monitoring Instrument products). The time‐height distribution, optical properties, sources and transport of smoke, and its impacts on air quality are investigated. Lidar profiles indicate that the smoke aerosols are confined to the planetary boundary layer (PBL) and have a depolarization ratio of less than 0.08. The aerosol optical depths increase from 0.5 to 3.0 at 500 nm, while the extinction‐related Angstrom exponent increases from 1.1 to 1.6 at the wavelength pair of 440–870 nm. The single‐scattering albedo becomes lower at 670–1020 nm following the ABB intrusion and particularly shows a decreasing tendency between wavelengths of 440 to 1020 nm. The absorption Angstrom exponent (0.7) is smaller than 1.0, which may indicate the aged smoke particles mixed or coated with the urban aerosols. Surface particular matter PM10 and PM2.5 show a dramatic increase, reaching hourly mean of 800 µg/m3 and 485 µg/m3, respectively, which results in a heavy air pollution event. The stagnant and high‐moisture weather provides favorable conditions for the aerosols to accumulate near the surface. Cloud‐Aerosol Lidar and Infrared Pathfinder Satellite Observation (CALIPSO) also illustrate that the large‐scale aerosols are primarily present in the PBL and transported to the ocean, but some dense smoke plumes are misclassified as cloud or polluted dust. By comparing with the observations, we found that the Weather Research and Forecasting–Chemistry model captured the accumulation and downwind transport of surface PM2.5 from 20:00 on 2 June to 10:00 on 3 June (phase 1) but showed a dramatic underestimate from 20:00 on 3–4 June (phase 2) when dense aerosols are present. Such a discrepancy in the model is associated with the improper vertical apportion of transported smoke and atmospheric diffusion conditions when comparing with the observed aerosol and wind profiles. In addition, the model simulations indicate that the transported smoke can contribute to 50–70% of the ground‐level PM2.5 in Nanjing.