The primary site of morphological changes in the airways associated with chronic cigarette smoking is the small airway epithelium. The small airway refers to bronchi of less than 2 mm in diameter. It is the initial site of Chronic Obstructive Pulmonary Disease (COPD). Mechanistic investigations of the effect of inhaled substances on the small airway tissue are difficult to conduct because biopsy samples are not readily obtainable. Recently, a human small airway epithelium culture model grown at the air liquid interface, SmallAir™ (Epithelix, Switzerland) was established. The model is reconstituted from primary small airway epithelial cells isolated from the distal lungs. The morphology of the model mimics the characteristics of in vivo human small airway epithelial tissue. It offers a relevant alternative for an in‐vitro toxicity assessment of inhalation exposure. Using the newly developed human organotypic small airway model (reconstituted from a healthy, non‐smoker donor), this study assessed the biological impact of an aerosol generated from a candidate modified risk tobacco product, the tobacco heating system 2.2 (THS2.2). The biological impact of the THS2.2 aerosol was compared with that of the smoke generated from the reference cigarette 3R4F at comparable nicotine concentrations. A comprehensive set of biological endpoints were measured at various time points after exposure including cytotoxicity, culture histology, cytochrome P450 (CYP) 1A1/1B1 activity, secreted pro‐inflammatory mediators concentrations, and global mRNA/miRNA alterations. Following a 28‐min exposure to 3R4F smoke, various inflammatory markers (MMP‐9, IL‐6 and IL‐8) and genes (MGST2, GPX2, AKR1B1) known to be involved in the pathogenesis of COPD were upregulated. A significantly lower impact of THS2.2 aerosol exposure was observed not only on these COPD‐related molecular entities, but also on cytotoxicity, secreted pro‐inflammatory mediators, and global alterations of mRNA and miRNA as compared with those of 3R4F smoke at comparable nicotine concentrations. Using a network‐based Systems Toxicology approach, the gene expression profile 4 h after 3R4F smoke exposure at 0.15 mg nicotine/L elicited the highest biological impact (taken as 100% impact). By comparison, the impact of THS2.2 aerosol exposure at comparable nicotine concentration was only 14.6%. Collectively, this study shows that the biological impact of THS2.2 aerosol was significantly lower than that of 3R4F smoke at similar nicotine concentrations on the in vitro small airway cultures.Support or Funding InformationPMI R&D, Philip Morris Products S.A., Quai Jeanrenaud 5, CH‐2000 Neuchâtel, Switzerland (Part of Philip Morris International group of companies).