The central endocannabinoid system is a neuroactive lipid signalling system in the brain which acts to control neurotransmitter release. The expression patterns of this system throughout limbic regions of the brain ideally situate it to exert regulatory control over emotional behaviour, mood and stress responsivity. A growing body of evidence unequivocally demonstrates that deficits in endocannabinoid signalling may result in depressive and anxiogenic behavioral responses, while pharmacological augmentation of endocannabinoid signalling can produce both antidepressive and anxiolytic behavioral responses. The aim of this review is to summarize current knowledge of the role of the endocannabinoid system in the etiology and treatment of mood and anxiety disorders, such as depression, anxiety and post-traumatic stress disorder. Collectively, both clinical and preclinical data argue that cannabinoid receptor signalling may be a realistic target in the development of a novel class of agent for the pharmacotherapy of mood and anxiety disorders.