When in cover if you hit LB you will light up a cigarette. Pressing LB again (or after a few moments) Sam will toss the cigarette to one side, which can be used to distract enemies temporarily.
There are a number of ways this achievement can be obtained, but since you only have three cigarettes available to you in each stage here's a easy and quick technique we found.
After you've finished the game (as changing missions will lose your weapon upgrades) load up mission 3-5 on casual.
During mission 3-5 after you've protected the friendly armor you'll be tasked with getting some engineers below the newly created hole in the Kreon. As you move forward you'll notice two sections of the Kreon across the gap that open up and present enemies. Clear the first smaller one and then move forward until the engines start to fire up and mess with your suit. The second section that opens up contains something like 18 smaller robots and two Romanovs. This is where you want to attempt the achievement.
(From Asuka Langley: "For clarification, the section above is just after you've disabled the walking leg of the Kreon. You'll start with a bridge in front of you. At the end of the bridge, stop and look left and you'll see the section of the Kreon open up and reveal lots of robots.")
As you progress through the level earlier on you should come across a rocket launcher. Grab this and make sure you have it to hand when you get to the section described above.
Once you are in place take cover (especially since your suit will be overheating due to the engines). After the engines stop wait for your boost bar to recover then light a cigarette and toss it. Make sure you have the rocket launcher equipped, jump out of cover and activate the suit's AR mode: now lock onto the robot in the middle of the middle row and fire. Alternatively, as per Asuka's advice, you can stay in cover and fire from there just after throwing the cigarette (as the robots fire away from you).
I managed to get the achievement in one go, but if it doesn't pop immediately repeat the action on the other row of robots.
[This solution was worked out between myself and Colonel Skills, so thanks to him for his input and being first to prove it worked]
[Thanks to Asuka Langley for additional tips]