Rationale: Nicotine affects many aspects of human cognition, including attention and memory. Activation of nicotinic acetylcholine receptors (nAChRs) in neuronal networks modulates activity and information processing during cognitive tasks, which can be observed in electroencephalograms (EEGs) and functional magnetic resonance imaging studies. Objectives: In this review, we will address aspects of nAChR functioning as well as synaptic and cellular modulation important for nicotinic impact on neuronal networks that ultimately underlie its effects on cognition. Although we will focus on general mechanisms, an emphasis will be put on attention behavior and nicotinic modulation of prefrontal cortex. In addition, we will discuss how nicotinic effects at the neuronal level could be related to its effects on the cognitive level through the study of electrical oscillations as observed in EEGs and brain slices. Results/Conclusions: Very little is known about mechanisms of how nAChR activation leads to a modification of electrical oscillation frequencies in EEGs. The results of studies using pharmacological interventions and transgenic animals implicate some nAChR types in aspects of cognition, but neuronal mechanisms are only poorly understood. We are only beginning to understand how nAChR distribution in neuronal networks impacts network functioning. Unveiling receptor and neuronal mechanisms important for nicotinic modulation of cognition will be instrumental for treatments of human disorders in which cholinergic signaling have been implicated, such as schizophrenia, attention deficit/hyperactivity disorder, and addiction. © Springer-Verlag 2005.