Objective In 2010, Peninsula Health (Vic., Australia), became smoke free as part of the locally developed smoking prevention and cessation strategy. The aim of the present study was to determine the effect of a smoke-free policy on smoking status and employee attitudes over a 3-year period. Methods Data were collected by three surveys 6 months before and 6 months and 3 years after policy introduction. Demographic data, smoking status and attitudes to the introduction of the smoke-free policy were collected for analysis. Results There were 3224 individual responses collected over three time points with similar demographics at each time. There were fewer employees smoking at 6 months (P = 0.010) and 3 years (P < 0.001) after implementation of the policy. There were more employees who felt positive towards the policy 3 years after its introduction (P = 0.028). There were greater odds of an employee not identifying as a smoker after the policy was in place than before the policy was implemented. Conclusions The introduction of a smoke-free policy within a health service was an upstream health intervention that was well accepted by staff and appeared to have a positive effect on smoking behaviours. What is known about the topic? There are an increasing number of environmental changes that seek to decrease smoking behaviours. Bans within workplaces have a direct effect on employee smoking behaviour. What does this paper add? Some employee groups demonstrated the greater odds of smoking when a smoke-free policy was in place. Employees felt positive towards this policy. What are the implications for practitioners? This policy change supports environmental changes affecting individual health-related behaviours.