Odorants, which are molecules with specific qualities, are sensed by chemoreceptors in the olfactory epithelium. This lies in the nasal cavity, and contains three kinds of cells- the ciliated sensory neurons (which contain the chemoreceptors), supporting cells (Bowman's glands, which produce mucous bathing the cells) and basal cells (which regularly divide and replace the sensory neurons). What happens when an odorant is recognized by its specific receptor is a series of intracellular events. The receptors themselves belong to the "7 pass" family which have G proteins attached. (These receptors are known as GPCRs, or G protein coupled receptors, and are involved in many other systems in the body such as taste, vision, and hormones). G proteins, when activated, go on to activate an enzyme called adenylyl cyclase, which converts ATP (adenosine triphosphate, which is a form of energy used by the body) into cAMP. cAMP is known as a second messenger (the first messenger is the odorant molecule), which goes on to activate other enzymes in the cell. In the case of olfaction, cAMP opens up ligand-gated sodium channels, depolarizing the sensory neuron. This generates an action potential, which gets passed onto the mitral cells (in the olfactory bulb) with glutamate as a neurotransmitter. A message is then sent to the limbic system of the brain, a primitive centre associated with emotions, motivation and memory. This explains how a whiff of something can bring back a lot of other details of a memory. There are also connections to the thalamus and frontal cortex, which allows recognition of the smell.

The sense of smell works perfect compared to other senses. Because it works so well, it is a the dominant sense in animals and no big brain is needed to judge if the sensation is real or not. For example eyes sense stuff that are really illusions at times and the brain works that out.