Anandamide (N-Arachidonoylethanolamine) amidohydrolase catalyzing hydrolysis of anandamide was characterized in mice. The enzymatic activity was highest in the liver, followed by the brain and testis. Negligible activity was found in heart, lung and spleen. The activity in brain and liver was mainly localized in the microsomal fractions. Kinetic experiments demonstrated that Km (microM) and Vmax (nmol/min/mg protein) for the brain microsomes were 9.3 and 2.58, respectively, while those for the hepatic microsomes were 180 and 18.9, respectively. The activity in the microsomes from the liver and brain was markedly inhibited by Cu2+, Hg2+, Se4+, phenylmethylsulfonylfluoride and sodium dodecylsulfate. Brain but not hepatic microsomal enzyme activity was inhibited by delta9-tetrahydrocannabinol, cannabidiol and cannabinol. Kinetic parameters demonstrated that the inhibition by the cannabinoids was competitive in nature. Relatively high distribution of the enzyme activity in brain suggests an importance of the enzyme in the central nervous system to regulate the neuromodulatory fatty-acid amides.