Percutaneous transluminal angioplasty is frequently used in patients with severe arterial narrowing due to atherosclerosis. However, it induces severe arterial injury and an inflammatory response leading to restenosis. Here, we studied a potential activation of the endocannabinoid system and the effect of fatty acid amide hydrolase (FAAH) deficiency, the major enzyme responsible for endocannabinoid anandamide degradation, in arterial injury. We performed carotid balloon injury in atherosclerosis-prone apolipoprotein E knockout (ApoE-/-) and ApoE-/-FAAH-/- mice. Anandamide levels were systemically elevated in ApoE-/- mice after balloon injury. ApoE-/-FAAH-/- mice had significantly higher baseline anandamide levels and enhanced neointima formation compared to ApoE-/- controls. The latter effect was inhibited by treatment with CB1 antagonist AM281. Similarly, ApoE-/- mice treated with AM281 had reduced neointimal areas, reduced lesional vascular smooth muscle cell (SMC) content and proliferating cell counts. The lesional macrophage content was unchanged. In vitro proliferation rates were significantly reduced in CB1-/- SMCs or when treating ApoE-/- or ApoE-/-FAAH-/- SMCs with AM281. Macrophage in vitro adhesion and migration was marginally affected by CB1 deficiency. Reendothelialization was not inhibited by treatment with AM281. In conclusion, endogenous CB1 activation contributes to vascular SMC proliferation and neointima formation in response to arterial injury.