Neutrophils are the primary inflammatory cell in smokers' lungs but little is known about the ability of cigarette smoke to modulate neutrophil function. Neutrophils undergo caspase-3-dependent spontaneous, as well as phagocytosis-induced, apoptosis. This study investigated the ability of cigarette smoke extract (CSE) to alter neutrophil caspase-3 activity, apoptosis and phagocytosis. CSE treatment resulted in a dramatic suppression of neutrophil caspase-3-like activity which correlated with reduced cleavage of GCLC, a known target of active caspase-3. CSE did not affect procaspase-3 processing to its active fragment, suggesting a direct effect of CSE on active caspase-3. Consistent with this, CSE inhibited active recombinant caspase-3 activity, which was abolished by dithiothreitol, suggesting a redox-sensitive mechanism. CSE-induced suppression of caspase-3 activity did not alter spontaneous apoptosis but did impair phagocytic activity. Since CSE treatment resulted in profound suppression of caspase-3 activity but did not alter apoptosis, the possibility of a threshold level of caspase-3 activity was investigated. CSE reduced caspase-3 activity in a concentration dependent manner. Despite near complete suppression of caspase-3 activity, spontaneous apoptosis was not altered. Conversely, treatment with the pan-caspase inhibitor, z-VAD-fmk, reduced spontaneous apoptosis. These data demonstrate that CSE does not suppress caspase-3 activity below a threshold level to prevent spontaneous apoptosis but the level of inhibition is sufficient to impair neutrophil phagocytic activity. These divergent functions of caspase-3 may contribute to the persistence of neutrophils in the lungs of smokers as well as be a factor in their higher incidence of community-acquired pneumonia.