Growing interest in pharmacological resting state fMRI (RSfMRI) necessitates developing standardized and robust analytical approaches that are insensitive to spurious correlated physiological signals. However, in pharmacological experiments physiological variations constitute an important aspect of the pharmacodynamic/pharmacokinetic profile of drug action; therefore retrospective corrective methods that discard physiological signals as noise may not be suitable. Previously, we have shown that template-based dual regression analysis is a sensitive method for model-free and objective detection of drug-specific effects on functional brain connectivity. In the current study, the robustness of this standard approach to physiological variations in a placebo controlled, repeated measures pharmacological RSfMRI study of morphine and alcohol in 12 healthy young men is tested. The impact of physiology-related variations on statistical inferences has been studied by: 1) modeling average physiological rates in higher level group analysis; 2) Regressing out the instantaneous respiration variation (RV); 3) applying retrospective image correction (RETROICOR) in the preprocessing stage; and 4) performing combined RV and heart rate correction (RVHRCOR) by regressing out physiological pulses convolved with canonical respiratory and cardiac hemodynamic response functions. Results indicate regional sensitivity of the BOLD signal to physiological variations, especially in the vicinity of large vessels, plus certain brain structures that are reported to be involved in physiological regulation, such as posterior cingulate, precuneus, medial prefrontal and insular cortices, as well as the thalamus, cerebellum and the brainstem. The largest impact of "correction" on final statistical test outcomes resulted from including the average respiration frequency and heart rate in the higher-level group analysis. Overall, the template-based dual regression method seems robust against physical noise that is corrected by RV regression or RETROICOR. However, convolving the RV and HR with canonical hemodynamic response functions caused a notable change in the BOLD signal variance, and in resting state connectivity estimates. The impact of RVHRCOR on statistical tests was limited to elimination of both morphine and alcohol effects related to the somatosensory network that consists of insula and cingulate cortex-important structures for autonomic regulation. Although our data do not warrant speculations about neuronal or vascular origins of these effects, these observations raise caution about the implications of physiological 'noise' and the risks of introducing false positives (e.g. increased white matter connectivity) by using generalized physiological correction methods in pharmacological studies. The obvious sensitivity of the posterior part of the default mode network to different correction schemes, underlines the importance of controlling for physiological fluctuations in seed-based functional connectivity analyses. © 2012 Elsevier Inc..