Tobacco existed in Kentucky long before the establishment of the commonwealth. Native Americans utilized tobacco medicinally and ceremonially. Settlers brought it with them to central and, eventually, western Kentucky. Until the late 1920s, Kentucky produced more tobacco than any other state. They remain the largest burley and dark tobacco producer, and rank second, in total pounds produced, to North Carolina.

Before mechanization, labor–intensive tobacco farming required either hand tools or animal–pulled machinery for heavily weather–dependent tilling and setting (transplanting). Farmers regularly "chop out" weeds and examine plants for insects and disease. They hand–removed troubling, green "tobacco hornworms" until insecticides emerged. Chemical growth inhibitors replaced manual removal of buds that grow between the stalk and stems, called "suckers." Farmers continue "topping" tobacco (removing the plant’s flower) by hand. Both practices (removing suckers and topping) encourage the growth of valuable leaves.

Farmers cut mature plants at the base, spear them onto tobacco sticks, and hang them in a barn, where tobacco air–cures or is cured with heat. Once cured, leaves are stripped from the stalk, separated by grades, and tied into bundles ("hands") or, beginning in the 1980s, baled. Most tobacco warehouses — where tobacco was sold at auction — are now closed.

Due to the labor required to raise tobacco, small family farms once grew tobacco in plots ranging from less than an acre to three to five acres. Farmers raising more crops contracted tenants to care for plots, which usually contained a house, barn, personal garden, livestock, and some farmland. After the crop was sold, tenants received 30 to 50 percent of the profit. Later, other leasing arrangements emerged under the federal tobacco program.

Early on, farmers grew burley tobacco with dark leaves and a strong taste. People bought this tobacco for pipes, cigars, and chewing, sometimes in a "twist." In the 1860s, a milder–flavored variety with lighter leaves emerged. This "light" or "white burley" replaced darker varieties. It gained commercial popularity through plug tobacco, then cigarettes by the early 1900s, because of its convenience and blending capabilities. White burley’s harvesting and curing ease made it a farmer’s favorite. Sky–rocketing demand caused Kentucky’s tobacco production to boom.

Late 19th–century farmers formed alliances in reaction to a faltering agricultural economy and increasing debt. The largest alliance in Kentucky, the Farmers’ and Laborers’ Union (established 1890) advocated a graduated income tax, government loans for warehouse storage, and prohibiting monopolies. By the turn of the century, the alliance fell, prices continued declining, and the American Tobacco Company (ATC) maintained their monopoly. Other groups, such as the Dark–fired Tobacco District Planters’ Protective Association, challenged the ATC by encouraging members to pool crops and withhold sales until the ATC offered higher prices.

Some farmers refused to boycott, frustrating more ardent coalition members, who resorted to violence. For two years, beginning in 1905, masked men known as "Night Riders" raided communities around the state, most notably in the "Black Patch" (Western Kentucky). They burned buildings, and destroyed fields and machinery in order to coerce hesitant farmers into joining them. They even beat and murdered non–participating farmers to intimidate others! The government finally dispersed the ATC’s monopoly in 1911.

During World War I, prices rose with the growing popularity of blended cigarettes, but dropped soon after. Kentucky burley farmers responded with an initially successful Burley Tobacco Growers Co–operative Association that was inactive by 1926. The Great Depression worsened the situation, costing some farmers their land! Work programs and legislation provided some relief. The New Deal introduced the federal tobacco program (strengthened through subsequent legislation), which stabilized prices. Farmers raised yearly quotas in exchange for "price supports" (minimum price per pound). The Burley Co–op was revived in 1941 to administer part of the price support program. Although the federal program ended in 2004 and most farmers now contract directly with manufacturers, the Co–op survives. Colleges, like the University of Kentucky’s College of Agriculture, also collaborate with government efforts by developing new cultivation methods, curing methods, disease–resistant varieties, and certifying seeds.

Aside from recreational and ceremonial use, some Native American and Western folk remedies involved tobacco, including pain–easing salves, fighting labor pains, using smoke for colic and asthma, and chewing to soothe toothaches. In 1964, the US Surgeon General released its first report regarding smoking hazards. Subsequent reports offered specific warnings about tobacco use, including heart and lung diseases, nicotine addiction, and cancer. These reports and other research changed American perspectives on tobacco. Despite declining popularity from societal attitudes and health risks, tobacco remains important in Kentucky’s culture and economy.