This POSTnote will look at progress towards 'smart'materials and structures which can sense and respond to the environment around them. Potential applications range from monitoring the structural integrity of bridges to targeted drug delivery in the human body. Smart materials could also have applications in energy efficiency and waste reduction, for example through the development of smart packaging materials. Academic research into smart materials has been going on for decades but as yet there are few commercial applications. The note will examine factors affecting exploitation, and progress made by bodies such as the Technology Strategy Board and Materials Knowledge Transfer Network, and make international comparisons. Issues such as ownership, sustainability and developmental relevance will also be explored.