When interpreted at face value, this is just a straightforward reference to a desert plant called colitas.

Deep Thought

But this "colitas" has been the source of much speculation. The "desert flower" thing certainly works, though people disagree over exactly which flower Henley might have been referring to.

The other suggestion, preferred by people who like to find hidden drug references in every song (what's up with those people), is that "colitas" refers to a part of the marijuana plant. As in, the speaker has been smoking dope, so he obviously smells it in his car.

To which we respond: quite possible. Drugs were a big part of the Eagles' lives during that period. But they don't otherwise figure much into this song, so we'll go with flowers for now.