Olfactory and emotional higher processing pathways share common anatomical substrates. Hence, depression is often accompanied by alterations in olfactory function. These alterations are negative in nature and may involve decreased activation in olfactory eloquent structures or decreased volume in the olfactory bulb (OB). We suggest that olfaction and depression interact in two ways. First, olfactory function in depression is impaired as a consequence of reduced olfactory attention and diminished olfactory receptor turnover rates. Second, the OB may constitute a marker for enhanced vulnerability to depression. Closer analysis of these interactions may help to explain observed experimental data, as well as to elucidate new therapeutic strategies involving olfaction. Because of the difficulties to disentangle cause from consequence in the relationship between olfaction and depression, longitudinal and intervention studies are necessary to elucidate this further.