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The Western world has witnessed a tremendous increase in the occurrence of allergy and autoimmunity in the second half of the 20th century. Extensive efforts have been made to explain this phenomenon and various hypotheses have been formulated. Among them, two concepts have attracted the most attention: the “hygiene hypothesis,” identifying the reduced exposure to environmental microorganisms as a driving force behind the observed epidemiological trends; and the “diet hypotheses,” pointing to the importance of changes in our dietary habits. In this review, we discuss the interplay between the Western diet, microbiota, and inflammatory conditions, with particular emphasis on respiratory diseases. This is followed by an in-depth overview of the immunomodulatory potential of different dietary fatty acids. We conclude by identifying the outstanding questions, which, if answered, could shed further light on the impact of dietary habits on immunity and interconnect it with postulates proposed by the hygiene hypothesis. Linking these two concepts will be an important step towards understanding how Western lifestyle shapes disease susceptibility.