Reduced olfactory efficiency in sniffer dogs results mainly from overheating, and causes physiological and behavioural resources to be diverted from concentration on the assigned task and applied instead to methods of body cooling. Dogs do not possess sweat glands, and panting is the main means of cooling the body. Since a dog can either sniff or pant, but can never perform both actions simultaneously, panting causes a decrease in sniffing rate. In various military operations dogs are required to detect explosives under severe physical conditions. In such situations, the dog's high body temperature elicits rapid panting already at the very beginning of the search task. As a result, its concentration and olfactory ability are diminished from the outset. In the current study we examined the ability of dogs to detect small explosives charges in two situations: (1) while relaxed and therefore only lightly panting; and (2) following exercise on a treadmill and therefore heavily panting. The results revealed an inverse ratio between rate of panting and efficiency of the dog's olfactory work, with increased panting resulting in a significant decrease in explosives detection. The decline in efficiency was also expressed in longer duration of search period. However, we also found that dogs are able to adjust to working under severe physiological conditions derived from extreme physical activity. Such adjustment can reduce the dog's limitations under strenuous conditions and can be taught by suitable training.