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Over the past decade, new research has taught us more about how nicotine affects the brain and the body. Some of it is good news -- for example, a lower incidence of Alzheimer's disease in smokers. Research has pointed to a compound called acetylcholine as the reason. Nicotine is structurally similar to acetylcholine, a naturally-occurring compound that serves as a neurotransmitter. Nicotine binds to nerve receptors and makes nerve cells fire more frequently. In one study, a group of Alzheimer's patients were given nicotine patches, while another received a placebo. Those with nicotine patches maintained their cognitive abilities longer and sometimes even recovered lost cognitive function.
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However, the research also showed a direct link between nicotine and an increase in the release of dopamine and serotonin, two vital neurotransmitters.
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In 2000, a study performed at Stanford revealed surprising results about nicotine's effects on blood vessels. Contrary to popular opinion, the study showed that nicotine actually boosts the growth of new blood vessels
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Researchers from the Scripps Research Institute published a study in 2002 that revealed a connection between nornicotine -- a chemical found in tobacco and also created when the body breaks down nicotine -- and a reduction of Alzheimer's symptoms. However, nornicotine is toxic, pointing to the need for a nontoxic substitute.

Neurotoxicity
Two opposing concepts confound the issue of nicotine's neurotoxicity: nicotine has a protecting effect in Alzheimer's and Parkinson's disease due to antioxidant properties [68], yet can induce cognitive impairments in the offspring of smoking mothers from oxidative cellular injury (69). So is nicotine neurotoxic? At first glance, it would appear that the answer is yes, since nicotine can decrease glutathione levels and increase oxidative markers such as malondialdehyde, lactate dehydrogenase, hydrogen peroxide, and superoxide ion (69,70).

However, evidence of increased oxidative stress is only evident when high dose nicotine is administered (1mM or 162mg and up). Lower dose nicotine appears to have free radical scavenging effects and protects against lipid peroxidation (71). It is also this "lower dose nicotine" (.1mM or 16mg) that most smokers are using, and in these quantities it seems to be protective against Alzheimer's and Parkinson's disease (72).