Nicotine dependence is a major predictor of relapse in people with Tobacco Use Disorder (TUD). Accordingly, therapies that reduce nicotine dependence may promote sustained abstinence from smoking. The insular cortex has been identified as a promising target in brain-based therapies for TUD, and has three major sub-regions (ventral anterior, dorsal anterior, and posterior) that serve distinct functional networks. How these subregions and associated networks contribute to nicotine dependence is not well understood, and therefore was the focus of this study. Sixty individuals (28 women; 18–45 years old), who smoked cigarettes daily, rated their level of nicotine dependence (on the Fagerström Test for Nicotine Dependence) and, after abstaining from smoking overnight (~12 h), underwent functional magnetic resonance imaging (fMRI) in a resting state. A subset of these participants (N = 48) also completing a cue-induced craving task during fMRI. Correlations between nicotine dependence and resting-state functional connectivity (RSFC) and cue-induced activation of the major insular sub-regions were evaluated. Nicotine dependence was negatively correlated with connectivity of the left and right dorsal, and left ventral anterior insula with regions within the superior parietal lobule (SPL), including the left precuneus. No relationship between posterior insula connectivity and nicotine dependence was found. Cue-induced activation in the left dorsal anterior insula was positively associated with nicotine dependence and negatively associated with RSFC of the same region with SPL, suggesting that craving-related responsivity in this subregion was greater among participants who were more dependent. These results may inform therapeutic approaches, such as brain stimulation, which may elicit differential clinical outcomes (e.g., dependence, craving) depending on the insular subnetwork that is targeted.