Lavender is believed to have an effect on the limbic system of the brain, which controls mood and memory. It additionally increases the activity of the parasympathetic nervous system, which could reduce the stress response in the body. There also seems to be an impact on the 5HT1A receptor, which has been implicated in anxiety. Reduced binding to this receptor could explain the anxiolytic effects of lavender.[1][2]
Voltage-dependent calcium channels (VDCC) are thought to be related to the inappropriate stress response found in the central nervous system of those with anxiety and other mood disorders. Lavender inhibits these channels, and thus attenuates this response. Lavender also increases the amount of serotonin in the system by blocking the serotonin transporters (SERT). SERT are presynaptic receptors that move serotonin from the synapse back into the cell. Blocking these transporters leaves more extracellular serotonin available to the brain, which can improve mood and anxiety symptoms. While this mechanism is similar to the way some antidepressant medications, such as SSRIs, work, there are also some differences, and lavender has a less significant effect on overall serotonin levels than antidepressant medications.[3][4]