The unique properties of humour make it a valuable tool in the process of teaching and acquiring English as a foreign language, especially when more advanced courses at the university level are concerned. In the first place, using humour based on language play (involving different aspects of linguistic structure) in a variety of teaching materials can be very beneficial to helping students improve their ability with language structures. Moreover, it is important that students develop an awareness of humour that is related to culture in order to achieve better command of English. In order to determine the effect humour has on students’ level of attainment, a small-scale study was conducted at the English Department, University of Novi Sad in the course Integrated Language Skills. In the study, humour was used both as a tool, to improve the learning environment, and as a resource for teaching new vocabulary or revising grammatical structures. The results of the study indicate that humour can be applied to teaching a foreign language and improving students’ proficiency level. Moreover, using humour both as a tool and as a resource affected students’ motivation and willingness to study.