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Mood processes are theorized to play a role in the initiation and progression of smoking behavior. Available work using real-time assessments in samples of young smokers, including several reports from the Social and Emotional Contexts of Adolescent Smoking Patterns (SECASP) study, has indicated that smoking events acutely improve mood and that escalating smoking frequency may stabilize mood. However, prior analyses have not specifically evaluated within-person change in nicotine dependence, which is conceptually distinguishable from frequent smoking and may be associated with unique mood consequences. The current investigation addressed this question using data from 329 adolescent SECASP participants (9th or 10th grade at recruitment) who contributed mood reports via ecological momentary assessment in up to four 1-week bursts over the course of 24 months. Mixed-effects location scale analyses revealed that within-person increases in scores on the Nicotine Dependence Syndrome Scale were associated with elevations in negative mood level and increased variability of both positive and negative moods. These effects remained when within-person changes in smoking frequency were covaried and were not fully attributable to a subgroup of youth who rapidly escalated their smoking frequency over time. The findings indicate that adolescents tend to show increasing levels of positive mood states, decreasing levels of negative mood, and diminishing mood variability between ages 16 to 18, but progression of nicotine dependence may counteract some of these developmental gains. Emergence of withdrawal symptoms is a likely explanation for the adverse mood effects associated with dependence progression.