The aryl hydrocarbon receptor repressor (AhRR) was first described as a specific competitive repressor of aryl hydrocarbon receptor (AhR) activity based on its ability to dimerize with the AhR nuclear translocator (ARNT) and through direct competition of AhR/ARNT and AhRR/ARNT complexes for binding to dioxin-responsive elements (DREs). Like AhR, AhRR belongs to the basic Helix-Loop-Helix/Per-ARNT-Sim (bHLH/PAS) protein family but lacks functional ligand-binding and transactivation domains. Transient transfection experiments with ARNT and AhRR mutants examining the inhibitory mechanism of AhRR suggested a more complex mechanism than the simple mechanism of negative feedback through sequestration of ARNT to regulate AhR signaling. Recently, AhRR has been shown to act as a tumor suppressor gene in several types of cancer cells. Furthermore, epidemiological studies have found epigenetic changes and silencing of AhRR associated with exposure to cigarette smoke and cancer development. Additional studies from our laboratories have demonstrated that AhRR represses other signaling pathways including NF-κB and is capable of regulating inflammatory responses. A better understanding of the regulatory mechanisms of AhRR in AhR signaling and adverse outcome pathways leading to deregulated inflammatory responses contributing to tumor promotion and other adverse health effects is expected from future studies. This review article summarizes the characteristics of AhRR as an inhibitor of AhR activity and highlights more recent findings pointing out the role of AhRR in inflammation and tumorigenesis.