Correlated spontaneous activity propagating over a wide region of the central nervous system is expressed during a specific period of embryonic development. We previously demonstrated using an optical imaging technique with a voltage-sensitive dye that this wave-like activity, which we referred to as the depolarization wave, is fundamentally involved in the early process of synaptic network formation. We found that the in ovo application of bicuculline/strychnine or d-tubocurarine, which blocked the neurotransmitters mediating the wave, significantly reduced functional synaptic expression in the brainstem sensory nucleus. This result, particularly for d-tubocurarine, an antagonist of nicotinic acetylcholine receptors, suggested that prenatal nicotine exposure associated with maternal smoking affects the development of neural circuit formation by interfering with the correlated wave. In the present study, we tested this hypothesis by examining the effects of nicotine on the correlated activity and assessing the chronic action of nicotine in ovo on functional synaptic expression along the vagal sensory pathway. In ovo observations of chick embryo behavior and electrical recording using in vitro preparations showed that the application of nicotine transiently increased embryonic movements and electrical bursts associated with the wave, but subsequently inhibited these activities, suggesting that the dominant action of the drug was to inhibit the wave. Optical imaging with the voltage-sensitive dye showed that the chronic exposure to nicotine in ovo markedly reduced functional synaptic expression in the higher-order sensory nucleus of the vagus nerve, the parabrachial nucleus. The results suggest that prenatal nicotine exposure disrupts the initial formation of the neural circuitry by inhibiting correlated spontaneous wave activity.