The endocannabinoid system (ECS) is a widespread neuromodulatory network involved in the developing central nervous system as well as playing a major role in tuning many cognitive and physiological processes. The ECS is composed of endogenous cannabinoids, cannabinoid receptors, and the enzymes responsible for the synthesis and degradation of endocannabinoids. In addition to its endogenous roles, cannabinoid receptors are the primary target of Δ9-tetrahydrocannabinol, the intoxicating component of cannabis. In this review, we summarize our current understanding of the ECS. We start with a description of ECS components and their role in synaptic plasticity and neurodevelopment, and then discuss how phytocannabinoids and other exogenous compounds may perturb the ECS, emphasizing examples relevant to psychosis.