In olfactory sensory neurons (OSNs), cytosolic Ca²⁺ controls the gain and sensitivity of olfactory signaling and, thus, serves as an essential regulator of OSN function. Important components of the molecular machinery that orchestrates the complex spatiotemporal Ca²⁺ dynamics in OSNs have been described, but key details are still missing. Here, we demonstrate a critical physiological role of mitochondrial Ca²⁺ mobilization in mouse OSNs. Combining a novel mitochondrial Ca²⁺ imaging approach with patch-clamp recordings, organelle mobility assays, and ultrastructural analysis of individual OSNs, our study identifies mitochondria as key determinants of olfactory signaling. We show that mitochondrial Ca²⁺ mobilization during sensory stimulation shapes the cytosolic Ca²⁺ response profile in OSNs, ensures a broad dynamic response range, and maintains sensitivity of the spike generation machinery. When mitochondrial function is impaired, olfactory neurons function as simple stimulus detectors rather than intensity encoders. Moreover, we describe activity-dependent recruitment of mitochondria to olfactory knobs, a mechanism that provides a context-dependent tool for OSNs to maintain cellular homeostasis and signaling integrity.