The aryl hydrocarbon receptor (AHR) is a ligand-activated transcription factor regulating the expression of genes, for instance encoding the monooxygenases cytochrome P450 (CYP) 1A1 and CYP1A2, which are important enzymes in metabolism of xenobiotics. The AHR is activated upon binding of polycyclic aromatic hydrocarbons (PAHs), persistent organic pollutants (POPs), and related ubiquitous environmental chemicals, to mediate their biological and toxic effects. In addition, several endogenous and natural compounds can bind to AHR, thereby modulating a variety of physiological processes. In recent years, ambient particulate matter (PM) associated with traffic related air pollution (TRAP) has been found to contain significant amounts of PAHs. PM containing PAHs are of increasing concern as a class of agonists, which can activate the AHR. Several reports show that PM and AHR-mediated induction of CYP1A1 results in excessive generation of reactive oxygen species (ROS), causing oxidative stress. Furthermore, exposure to PM and PAHs induce inflammatory responses and may lead to chronic inflammatory diseases, including asthma, cardiovascular diseases, and increased cancer risk. In this review, we summarize findings showing the critical role that the AHR plays in mediating effects of environmental pollutants and stressors, which pose a risk of impacting the environment and human health. Particulate matter (PM) can adsorb polycyclic aromatic hydrocarbons (PAH), and heavy metals (HM). Particle cores and absorbed chemicals may trigger different cellular mechanisms, possibly resulting in adverse health effects. In this review, we discuss the effects of chemicals, which are ligands of the aryl hydrocarbon receptor (AHR), a latent transcription factor. PAHs activate the AHR, causing gene transcription and ultimately oxidative stress, inflammation and cellular changes. These are context dependent and may be different for different tissues and organs. Display omitted •PAHs present on ambient air pollution particles are ligands of the cellular AHR.•AHR-dependent induction of CYP1, AKR, NOX and COX-2 genes can be a source of ROS generation.•AHR signaling and NRF2 signaling interact to regulate the expression of antioxidant genes.•Air pollution and ROS can affect inflammation, which is partially triggered by AHR and associated immune responses.•Skin, lung, and the cardiovascular system are major target sites for air pollution-induced inflammation.