Two cannabinoid receptors, designated neuronal (or CB1) and peripheral (or CB2), have recently been cloned. Activation of CB1 receptors leads to inhibition of adenylate cyclase and N-type voltage-dependent Ca2+ channels. Here we show, using a CB2 transfected Chinese hamster ovary cell line, that this receptor binds a variety of tricyclic cannabinoid ligands as well as the endogenous ligand anandamide. Activation of the CB2 receptor by various tricyclic cannabinoids inhibits adenylate cyclase activity and this inhibition is pertussis toxin sensitive indicating that this receptor is coupled to the Gi/G(o) GTP-binding proteins. Interestingly, contrary to results with CB1, anandamide did not inhibit the CB2 coupled adenylate cyclase activity and delta 9-tetrahydrocannabinol had only marginal effects. These results characterize the CB2 receptor as a functional and distinctive member of the cannabinoid receptor family.