Background A lumbar puncture constitutes an important diagnostic procedure in the evaluation of idiopathic intracranial hypertension. Chronic overflow of cerebrospinal fluid into the sheaths of the olfactory nerves appears to be related to olfactory impairment in these patients. Here, we asked whether cerebrospinal fluid drainage in idiopathic intracranial hypertension patients improves olfactory function. Methods Fourteen idiopathic intracranial hypertension patients and 14 neurologic control patients were investigated before and after lumbar puncture using the extended Sniffin’ Sticks procedure. We assessed odor threshold, discrimination, and identification. In idiopathic intracranial hypertension patients, cerebrospinal fluid was drained until cerebrospinal fluid pressure had normalized. In addition, a third group of 14 healthy controls participated in the two smell tests at similar intervals. Results Relative to healthy controls, threshold, discrimination, and identification composite scores before lumbar puncture were significantly lower in idiopathic intracranial hypertension patients and also in neurologic controls. Following lumbar puncture, threshold, discrimination, and identification scores for neurologic controls remained unchanged whereas idiopathic intracranial hypertension patients showed robust improvement on the composite score as well as on all three subscores (all changes: p < 0.003), quickly regaining olfactory function in the normal range. Cerebrospinal fluid opening pressure was significantly correlated with improvement in threshold, discrimination, and identification score upon cerebrospinal fluid drainage ( r = 0.609, p = 0.021). Conclusion Olfactory impairment is an important, yet underappreciated, clinical feature of idiopathic intracranial hypertension. Lowering of increased intracranial pressure improves hyposmia. Our findings shed new light on the pathophysiology of cerebrospinal fluid circulation in idiopathic intracranial hypertension.