Little is known of the involvement of endocannabinoids and cannabinoid receptors in skeletal muscle cell differentiation. We report that, due to changes in the expression of genes involved in its metabolism, the levels of the endocannabinoid 2-arachidonoylglycerol (2-AG) are decreased both during myotube formation in vitro from murine C2C12 myoblasts and during mouse muscle growth in vivo. The endocannabinoid, as well as the CB1 agonist arachidonoyl-2-chloroethylamide, prevent myotube formation in a manner antagonized by CB1 knockdown and by CB1 antagonists, which, per se, instead stimulate differentiation. Importantly, 2-AG also inhibits differentiation of primary human satellite cells. Muscle fascicles from CB1 knockout embryos contain more muscle fibers, and postnatal mice show muscle fibers of an increased diameter relative to wild-type littermates. Inhibition of Kv7.4 channel activity, which plays a permissive role in myogenesis and depends on phosphatidylinositol 4,5-bisphosphate (PIP2), underlies the effects of 2-AG. We find that CB1 stimulation reduces both total and Kv7.4-bound PIP2 levels in C2C12 cells and inhibits Kv7.4 currents in transfected CHO cells. We suggest that 2-AG is an endogenous repressor of myoblast differentiation via CB1-mediated inhibition of Kv7.4 channels.