During the last eight years a number of bioactive lipid mediators, the amides or esters of long chain fatty acids, have been discovered or re-discovered. These are: anandamide (N-arachidonoyl-ethanolamine, AEA) and 2-arachidonoylglycerol (2-AG), two endogenous agonists of cannabinoid receptors; oleamide (cis-9-octadecenoamide), a putative endogenous sleep-inducing factor; N-palmitoylethanol amine (PEA), a compound with promising anti-inflammatory and immune-modulatory activity. These compounds are all substrates for the same hydrolytic enzyme, fatty acid amide hydrolase (FAAH), whose molecular characterization was obtained in 1996. The molecular and enzymatic properties, tissue distribution, substrate recognition properties, physiological regulation and biological role of FAAH are discussed in this article, with special emphasis on the possible pharmacological manipulation of the activity of this enzyme with therapeutic purpose.