Nicotine (NIC) is an exogenous ligand of the nicotinic acetylcholine receptor (nAChR), and it influences various functions in the central nervous system. Systemic administration of NIC elicits the release of endogenous opioids (endorphins, enkephalins, and dynorphins) in the supraspinal cord. Additionally, systemic NIC administration induces the release of methionine-enkephalin in the spinal dorsal horn. NIC has acute neurophysiological actions, including antinociceptive effects, and the ability to activate the hypothalamic-pituitary-adrenal (HPA) axis. The endogenous opioid system participates in NIC-induced antinociception, but not HPA axis activation. Moreover, NIC-induced antinociception is mediated by α4β2 and α7 nAChRs, while NIC-induced HPA axis activation is mediated by α4β2, not α7, suggesting that the effects of NIC on the endogenous opioid system are mediated by α7, not α4β2. NIC has substantial physical dependence liability. The opioid-receptor antagonist naloxone (NLX) elicits NIC withdrawal after repeated NIC administration, and NLX-induced NIC withdrawal is inhibited by concomitant administration of an opioid-receptor antagonist. NLX-induced NIC withdrawal is also inhibited by concomitant administration of an α7 antagonist, but not an α4β2 antagonist. Taken together, these findings suggest that NIC-induced antinociception and the development of physical dependence are mediated by the endogenous opioid system, via the α7 nAChR.