How is physiological dependence related to addiction?

To keep it simple, physiological dependence occurs when the individual needs the presence of a chemical in his or her system in order to feel relatively normal. At that point, using has become less an option than a need.

The entire addiction syndrome includes physiological dependence, but also social, emotional and spiritual issues that stem from the effects of the chemicals and the need to keep them flowing, such as lying, making excuses, stealing, loss of spiritual values such as compassion, forgiveness and joy, and so forth -- along with an overpowering fear that somehow the chemicals will not be available when needed, and the fear of withdrawal and the changes that accompany abstinence.

Note: I use "chemicals" instead of "drugs" because some addictions are related to self-generated brain chemicals, not just stimulation from drugs.