Pure cocaine was first extracted and identified by the German chemist Albert Niemann in the mid-19th century, and was introduced as a tonic/elixir in patent medicines to treat a wide variety of real or imagined illnesses. Later, it was used as a local anesthetic for eye, ear, and throat surgery and continues today to have limited employment in surgery. Currently, it has no other clinical application, having been largely replaced by synthetic local anesthetics such as lidocaine.

Because of its potent euphoric and energizing effects, many people in the late 19th century took cocaine, even though some physicians recognized that users quickly became dependent. In the 1880s, the psychiatrist Sigmund Freud created a sensation with a series of papers praising cocaine's potential to cure depression, alcoholism, and morphine addiction. Skepticism soon replaced this excitement, however, when documented reports of fatal cocaine poisoning, alarming mental disturbances, and cocaine addiction began to circulate.

According to information collected in 1902, 92% of all cocaine sold in major cities in the United States was in the form of an ingredient in tonics and potions available from local pharmacies. In 1911, the Canadian government legally restricted cocaine use, and its popularity waned. The 1920s and '30s saw a marked decline in its use, especially after amphetamines became easily available. Cocaine's return to popularity, beginning in the late 1960s, coincided with the decreased use of amphetamines.

Cocaine is generally sold on the street as a hydrochloride salt - a fine, white crystalline powder known as coke, C, snow, flake, or blow. Street dealers dilute it with inert (non-psychoactive) but similar-looking substances such as cornstarch, talcum powder, and sugar, or with active drugs such as procaine and benzocaine (used as local anesthetics), or other CNS stimulants such as amphetamines. Nevertheless, illicit cocaine has actually become purer over the years; according to RCMP figures, in 1988 its purity averaged about 75%.

Cocaine in powder form is usually "snorted" into the nostrils, although it may also be rubbed onto the mucous lining of the mouth, rectum, or vagina. To experience cocaine's effects more quickly, and to heighten their intensity, users sometimes inject it. Cocaine hydrochloride can be chemically altered to remove other substances. The process, called "freebasing," is potentially dangerous because the solvents used are highly flammable. The pure form of cocaine that results ("free base") is smoked rather than snorted. The drug commonly called "crack" is a crude form of free base that has become popular in recent years.

Short-term effects of cocaine include constricted peripheral blood vessels, dilated pupils, increased temperature, heart rate, blood pressure, insomnia, loss of appetite, feelings of restlessness, irritability, and anxiety. Duration of cocaine's immediate euphoric effects, which include energy, reduced fatigue, and mental clarity, depends on how it is used. The faster the absorption, the more intense the high. However, the faster the absorption, the shorter the high lasts. The high from snorting may last 15 to 30 minutes, while that from smoking may last 5 to 10 minutes. Cocaine's effects are short lived, and once the drug leaves the brain, the user experiences a "coke crash" that includes depression, irritability, and fatigue.

High doses of cocaine and/or prolonged use can trigger paranoia. Smoking crack cocaine can produce a particularly aggressive paranoid behavior in users. When addicted individuals stop using cocaine, they often become depressed. Prolonged cocaine snorting can result in ulceration of the mucous membrane of the nose.

Psychological dependence exists when a drug is so central to a person's thoughts, emotions, and activities that it becomes a craving or compulsion. Among heavy cocaine users, an intense psychological dependence can occur; they suffer severe depression if the drug is unavailable, which lifts only when they take it again.

Experiments with animals suggest that cocaine is perhaps the most powerful drug of all in producing psychological dependence. Rats and monkeys made dependent on cocaine will always strive hard to get more.

At present, researchers do not agree on what constitutes physical dependence on cocaine. When regular heavy users stop taking the drug, however, they experience what they term the "crash" shortly afterwards. Overall, during abstinence, many users complain of sleep and eating disorders, depression, and anxiety, and the craving for cocaine often compels them to take it again.