The modulatory and protective effects of aqueous Azadirachta indica leaf extract (AAILE) had been investigated against cigarette smoke-induced pulmonary oxidative stress and risk of lung cancer. Male Balb/c mice were divided in 4 groups: control, cigarette smoke (CS), AAILE, and AAILE + CS. Animals in the CS group were exposed to cigarette smoke for a period of 10 weeks. AAILE oral administration at a dosage of 100 mg/kg body weight was started 2 weeks prior to CS exposure and continued until the termination of the experiment. The pulmonary tissue was analyzed for molecular changes and assessed for the risk of lung cancer and status of pulmonary detoxification enzymes. An increase in CH2/CH3 and decrease in PO2/amide II observed in Fourier transform infrared spectrometry correlated well with acute inflammation, infiltration, and lipid peroxidation levels observed in histopathological studies and malionaldehyde levels in mice exposed to CS. No change was observed in the amide I:amide II ratio. The subtle balance between carcinogen activation and detoxification was found to be derailed, and it was manifested as a 1.5-times increase in the risk of developing lung cancer in the CS-exposed group. However, these changes seemed to normalize upon AAILE supplementation.