During the past several years, cannabinoid biology has witnessed marked advances that has propelled it to the forefront of biomedical research. These new developments have also provided an opportunity to examine the physiological and biochemical events underlying the use and abuse of cannabis as well as elucidating the biological role of the endogenous cannabinoid ligands (endocannabinoids). The biological targets for endocannabinoids include the cannabinoid receptors (CB1 and CB2), the enzyme anandamide amidohydrolase (AAH), and the carrier protein referred to as the anandamide transporter (ANT). The identification of arachidonylethanolamide (anandamide, AEA) as an endogenous cannabinoid has been an important development in cannabinoid research which has led to the identification of two proteins associated with cannabinoid physiology in addition to the CB1 and CB2 receptors. These proteins are anandamide amidohydrolase (AAH), an enzyme responsible for the hydrolytic breakdown of anandamide and the anandamide transporter (ANT), a carrier protein involved in the transport of anandamide across the cell membrane. Evidence obtained so far suggests that these two proteins, in combination, are responsible for the termination of the biological actions of anandamide. Also, the discovery of anandamide has revealed a novel class of more selective agents possessing somewhat different pharmacological properties than the cannabinoids. A number of such analogs have now been reported many of which possess markedly improved cannabinoid receptor affinities and metabolic stabilities compared to those of the parent ligand. Generally, anandamide and all known analogs exhibit significant selectivities with high affinities for the CB1 receptor and modest to very low affinity for the CB2 receptor. In a relatively short period of time, pharmacological and biochemical studies have confirmed initial speculations that anandamide is either a neuromodulator or neurotransmitter and has significantly advanced our understanding of cannabinoid biochemistry. This summary seeks to define the pharmacology of endocannabinoids and to focus on the structure-activity relationships (SAR) of anandamide for the CB1 cannabinoid receptor.