Previous studies have shown that cue-elicited tobacco craving disrupted performance on cognitive tasks; however, no study has examined directly the effect of cue-elicited craving on memory encoding and retrieval. A distinction between encoding and retireval has been reported such that memory is more impaired when attention is divided at encoding than at retrieval. This study tested the hypothesis that active imagery of smoking situations would impair encoding processes, but have little effect on retrieval. Imagery scripts (cigarette craving and neutral content) were presented either before presentation of a word list (encoding trials) or before word recall (retrieval trials). A working memory task at encoding and free recall of words were assessed. Results indicated that active imagery disrupted working memory on encoding trials, but not on retrieval trials. There was a trend toward impaired working memory following craving scripts compared with neutral scripts. These data support the hypothesis that the cognitive underpinnings of encoding and retrieval processes are distinct.