Domestic tobacco producers have faced increasing competition from imported tobacco since the late 1970s. Much of the debate has centered on the unknown quality of imported tobacco. This study provides a discussion and clarification of the concept of quality, and demonstrates a method of measuring the average quality of imported tobacco. The results show that since 1977, imported tobacco has been steadily decreasing in average quality and moving toward lower quality producing countries and types of tobacco. The reasons for this decline are discussed along with the policy implications.