The Great Recession produced the highest rates of unemployment observed in decades, in part due to particularly high rates of people losing work involuntarily. The impact of these job losses on health is unknown, due to the length of time required for most disease development, concerns about reverse causation, and limited data that covers this time period. We examine associations between job loss, employment status and smoking, the leading preventable cause of death, among 13,571 individuals participating in the 2001-2011 waves of the U.S.-based Panel Study of Income Dynamics. Results indicate that recent involuntary job loss is associated with an average 1.1 percentage point increase in smoking probability. This risk is strongest when people have returned to work, and appears reversed when they leave the labor market altogether. Although some job loss is associated with changes in household income and psychological distress levels, we find no evidence that these changes explain smoking behavior modifications. Smoking prevention programs and policies targeted at displaced workers or the newly employed may alleviate some negative health effects produced by joblessness during the Great Recession.