Inhaling Essential Oils
The theory behind aromatherapy:
It is believed that the inhalation of essential oils stimulates the part of the brain connected to smell - the olfactory system; a signal is sent to the limbic system of the brain that controls emotions and retrieves learned memories. This causes chemicals to be released which make the person feel relaxed, calm, or even stimulated. If the aromatherapy includes massage the effect is to further relax the person.
The "smell" receptors in your nose communicate with parts of your brain (the amygdala and hippocampus) that serve as storehouses for emotions and memories. When you breathe in essential oil molecules, some researchers believe they stimulate these parts of your brain and influence physical, emotional, and mental health. For example, scientists believe lavender stimulates the activity of brain cells in the amygdala similar to the way some sedative medications work. Other researchers think that molecules from essential oils may interact in the blood with hormones or enzymes.
Aromatherapy | University of Maryland Medical Center