Research has shown that external stimuli presented during sleep can affect dream content, thus reflecting information processing of the sleeping brain. Olfactory stimuli should have a stronger effect on dream emotions because their processing is linked directly to the limbic system. Because selective olfactory stimulation does not increase arousal activity, intense olfactory stimulation is therefore a prime paradigm for studying information processing during sleep. Fifteen healthy, normosmic volunteers were studied by intranasal chemosensory stimulation during rapid eye movement sleep based on air-dilution olfactometry. For olfactory stimulation, hydrogen sulphide (smell of rotten eggs) and phenyl ethyl alcohol (smell of roses) was used and compared with a control condition without stimulation. The olfactory stimuli affected significantly the emotional content of dreams: the positively toned stimulus yielded more positively toned dreams, whereas the negative stimulus was followed by more negatively toned dreams. Direct incorporations, i.e. the dreamer is smelling something, were not found. The findings indicate that information processing of olfactory stimuli is present in sleep and that the emotional tone of dreams can be influenced significantly depending upon the hedonic characteristic of the stimulus used. It would be interesting to conduct learning experiments (associating specific odours with declarative material) to study whether this declarative material is incorporated into subsequent dreams if the corresponding odour cue is presented during sleep. It would also be interesting to study the effect of positively toned olfactory stimuli on nightmares.