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Cigarette smoke mediates DNA damage, lipid peroxidation, and modification and misfolding of proteins, thereby inducing severe cellular damage. The ubiquitin proteasome system serves as the major disposal system for modified and misfolded proteins and is thus essential for proper cellular function. Its role in cigarette smoke-induced cell damage, however, is largely unknown. We hypothesized that the ubiquitin-proteasome system is involved in the degradation of cigarette smoke-damaged proteins and that cigarette smoke exposure impairs the proteasome itself. Here, we show that treatment of human alveolar epithelial cells with cigarette smoke extract (CSE) induced time- and dose-dependent cell death, a rise in intracellular reactive oxygen species, and increased levels of carbonylated and polyubiquitinated proteins. While high doses of CSE severely impaired all three proteasomal activities, low CSE concentrations significantly inhibited only the trypsin-like activity of the proteasome in alveolar and bronchial epithelial cells. Moreover, acute exposure of mice to cigarette smoke significantly impaired the trypsin-like activity by 25% in the lungs. Reduced proteasome activity was not due to transcriptional regulation of the proteasome. Notably, cigarette smoke exposure induced accumulation of polyubiquitinated proteins in the soluble and insoluble protein fraction of the lung. We show for the first time that acute exposure to cigarette smoke directly impairs proteasome activity in the lungs of mice and in human epithelial cells at low doses without affecting proteasome expression. Our results indicate that defective proteasomal protein quality control may exacerbate the detrimental effects of cigarette smoke in the lung.