The endocannabinoid system participates in the regulation of CNS homeostasis and functions, including neurotransmission, cell signaling, inflammation and oxidative stress, as well as neuronal and glial cell proliferation, differentiation, migration and survival. Endocannabinoids are produced by multiple cell types within the CNS and their main receptors, CB1 and CB2, are expressed in both neurons and glia. Signaling through these receptors is implicated in the modulation of neuronal and glial alterations in neuroinflammatory, neurodegenerative and psychiatric conditions, including Alzheimer’s, Parkinson’s and Huntington’s disease, multiple sclerosis, amyotrophic lateral sclerosis, stroke, epilepsy, anxiety and depression. The therapeutic potential of endocannabinoid receptors in neurological disease has been hindered by unwelcome side effects of current drugs used to target them; however, due to their extensive expression within the CNS and their involvement in physiological and pathological process in nervous tissue, they are attractive targets for drug development. The present review highlights the potential applications of the endocannabinoid system for the prevention and treatment of neurologic and psychiatric disorders.