"This is a classic liberal versus conservative race," Smith said on Monday. "It's about giving the people of New Hampshire the choice of taking the country in the direction of more government spending and nationalized healthcare, or in a conservative direction of less spending, reduced debt, and healthcare based off of the private sector."
Shaheen is among the vulnerable Democrats seeking re-election next year. Speculation on her challenger has largely focused on Scott Brown, a former Massachusetts senator who is considering moving to New Hampshire to run. But Smith said whatever Brown decided to do, it wouldn't have a large impact on his own campaign.
"I don't know him personally and have no know idea what he will do, but if he will run, the more the merrier," Smith said of Brown. "It's good for the party to have a choice - to decide what direction they want to go in taking the country away from the left."
Regardless of Brown's decision, some Republicans in New Hampshire are not enthusiastic about Smith's candidacy and think his chances of defeating Shaheen are slim.
David Carney, a New Hampshire GOP consultant and former Deputy Chief of Staff to Gov. John Sununu, said Smith's candidacy will not impact the race.
"He was rejected and thrown out of office … and I see very few folks who will rally to his tattered banner this time either," Carney told ABC News. "He is a craven free media seeker and he will provide some comic relief but in the serious business of fielding credible candidates he does not fit into that equation."
Smith, 72, has frequently drawn criticism from Republicans, including when he switched his party affiliation several times and for running in the Republican Party primary for the Senate in Florida, where he lives five to six months out of the year, in both in 2004 and 2010.
"I understand when you have an 18-year political career, you have plenty to shoot at," Smith said. "I'm not hiding from it. Sometimes you make mistakes and sometimes you do the right thing."
He defended his New Hampshire ties, noting that he owns a house there dating back to the early 1970s, campaigned for Newt Gingrich in the state, and has written columns for and done interviews with local New Hampshire media outlets.
Fergus Cullen, who chaired the New Hampshire Republican Party from 2007 to 2008 and interned for Smith in 1992, said that while Smith should be able to make his case to the people of New Hampshire, his reputation is tarnished enough that it could hurt his chances at being a competitive challenger in the race.
"Senator Smith burned a lot of bridges and boats when his Senate career ended," Cullen told ABC News. "His presidential candidacy in 1999 and his quitting of the party in a huff gave permission to establishment Republicans to abandon him, and they did."
Cullen described Smith as a very polarizing senator among both parties. When then-New Hampshire Gov. Jeanne Shaheen decided to challenge Smith in 2002, Cullen said it was unlikely that Republicans would hold onto the seat without a different candidate in place as the GOP nominee.
"The resulting primary between Smith and young John Sununu left scars," Cullen said. "I don't see how Smith can repair many of those relationships."
But Smith still remains confident that he can reclaim his old seat.
"I have a consistent conservative voting record in the Senate and House," said Smith, defiant in his response to the criticism. "It's who I am."