Objectives: Olfactory dysfunction is described in several neuropsychiatric disorders but there is little research on olfactory processing in bipolar disorder. Methods: We assessed odor detection threshold (sensitivity) and smell identification test scores, along with symptoms, cognition, and social function in 20 DSM-IV bipolar disorder patients and 44 control subjects. Results: The patient and control groups had similar demographic measures, intelligence, and mean olfaction scores, but significantly differed in social domains, including adjustment, function, and anxiety. Odor detection sensitivity showed significantly opposite correlations for the depressive and manic mood domains in bipolar disorder (r to z = 2.83, p = 0.005). Depressive symptoms were related to increased sensitivity (the ability to detect odors at a lower concentration) and mania symptoms were related to decreased sensitivity for odor detection. Increased sensitivity for odor detection also predicted significantly better employment (r = -0.642, p = 0.024), whereas less sensitivity was associated with social avoidance (r = 0.702, p = 0.024) and social fear (r = 0.610, p = 0.046). Conclusions: Diminished odor detection sensitivity predicted mania and social avoidance, whereas more sensitive odor detection predicted more depressive symptoms but better employment functioning in bipolar disorder patients. Odor acuity may be an illness state marker of mood syndromes in bipolar disorder. Alternatively, differences in odor acuity may identify heterogeneous subgroups within the bipolar spectrum. Longitudinal assessments in a large, sex-stratified sample are needed to understand the implications of odor sensitivity in patients with bipolar disorder.