Cigarette smoking is the leading preventable cause of death in the Western world, with a considerably higher prevalence observed in schizophrenia compared to the general population. Despite the negative health consequences of smoking heavily, it has been proposed that individuals with schizophrenia may maintain smoking behaviours to remediate symptoms associated with the disorder. Neurocognitive deficits are a core feature of schizophrenia and are present in approximately 80% of patients. Further, these deficits constitute an endophenotype of schizophrenia, as they are stable across disease phases, and heritable. The neurocognitive deficits that are present in schizophrenia are especially debilitating, since they are associated with poor clinical and functional outcomes and community integration. Interestingly, these deficits may also constitute a vulnerability factor towards the initiation and maintenance of tobacco use. Contributing to the potential shared vulnerability between schizophrenia and tobacco dependence is a dysregulation of the nicotinic acetylcholine receptor (nAChR) system. Pre-clinical evidence has shown that nicotine affects several neurotransmitter systems, including dopamine (DA), glutamate, and γ-aminobutyric acid (GABA), and certain neuropsychological deficits associated with these neurotransmitters (reaction time, spatial working memory, sustained attention, and sensory gating) are improved after nicotine administration in patients with schizophrenia. These positive effects on neurocognition appear to be more pronounced in smokers with schizophrenia, and may be an important mechanism that explains the co-morbidity of schizophrenia and tobacco dependence.