Cognitive dissonance is a psychological phenomenon that occurs when an individual experiences mental discomfort due to holding two or more contradictory beliefs or values. In Laila's case, she recognizes that smoking is harmful to her health, yet she continues to smoke. This conflict between her knowledge of the dangers of smoking and her behavior creates cognitive dissonance. To resolve this discomfort, individuals may change their beliefs, justify their behavior, or downplay the importance of the conflicting belief. Understanding cognitive dissonance is crucial in psychology as it explains how people cope with conflicting thoughts and the lengths they may go to in order to maintain internal consistency.