Abstract Background Strong epidemiologic evidence correlates tobacco use with a variety of serious adverse health effects, but the biological mechanisms that produce these effects remain elusive. Results We analyzed gene transcription data to identify expression spectra related to tobacco use in circulating leukocytes of 67 Caucasian male subjects. Levels of cotinine, a nicotine metabolite, were used as a surrogate marker for tobacco exposure. Significance Analysis of Microarray and Gene Set Analysis identified 109 genes in 16 gene sets whose transcription levels were differentially regulated by nicotine exposure. We subsequently analyzed this gene set by hyperclustering, a technique that allows the data to be clustered by both expression ratio and gene annotation (e.g. Gene Ontologies). Conclusion Our results demonstrate that tobacco use affects transcription of groups of genes that are involved in proliferation and apoptosis in circulating leukocytes. These transcriptional effects include a repertoire of transcriptional changes likely to increase the incidence of neoplasia through an altered expression of genes associated with transcription and signaling, interferon responses and repression of apoptotic pathways.