Our understanding of the complexity of the endocannabinoid system has evolved considerably since the cloning of the receptors in the early 1990s. Since then several endogenous ligands have been identified and their respective biosynthetic pathways unravelled. This research has revealed the involvement of the cannabinoid system in a number of important physiological processes including the regulation of neurotransmitter release, pain and analgesia, energy homeostasis, and control of immune cell function. All of these events are mediated by two similar receptors, CB1 and CB2, which were initially thought to possess mutually exclusive expression profiles. Recent advances have begun to dissolve such absolutes with the discovery of CB2 in brain tissue and identification of a range of functions for CB1 in peripheral tissues. With improved understanding of the cannabinoid system comes the illumination of various roles in disease pathologies and identification of potential therapeutic targets. This review provides an overview of the current understanding of the endocannabinoid system, and then focuses on recent discoveries that we believe are likely to shape the future directions of the field.