Fatty acid amide hydrolase (FAAH) is responsible for the hydrolysis of a number of important endogenous fatty acid amides, including the endogenous cannabimimetic agent anandamide (AEA), the sleep-inducing compound oleamide, and the putative anti-inflammatory agent palmitoylethanolamide (PEA). In recent years, there have been great advances in our understanding of the biochemical and pharmacological properties of the enzyme. In this commentary, the structure and biochemical properties of FAAH and the development of potent and selective FAAH inhibitors are reviewed, together with a brief discussion on the therapeutic possibilities for such compounds in the treatment of inflammatory pain and ischaemic states.