Endocannabinoids play central roles in retrograde signaling at a wide variety of synapses throughout the CNS. Although several molecular components of the endocannabinoid system have been identified recently, their precise location and contribution to retrograde synaptic signaling is essentially unknown. Here we show, by using two independent riboprobes, that principal cell populations of the hippocampus express high levels of diacylglycerol lipase alpha (DGL-alpha), the enzyme involved in generation of the endocannabinoid 2-arachidonoyl-glycerol (2-AG). Immunostaining with two independent antibodies against DGL-alpha revealed that this lipase was concentrated in heads of dendritic spines throughout the hippocampal formation. Furthermore, quantification of high-resolution immunoelectron microscopic data showed that this enzyme was highly compartmentalized into a wide perisynaptic annulus around the postsynaptic density of axospinous contacts but did not occur intrasynaptically. On the opposite side of the synapse, the axon terminals forming these excitatory contacts were found to be equipped with presynaptic CB1 cannabinoid receptors. This precise anatomical positioning suggests that 2-AG produced by DGL-alpha on spine heads may be involved in retrograde synaptic signaling at glutamatergic synapses, whereas CB1 receptors located on the afferent terminals are in an ideal position to bind 2-AG and thereby adjust presynaptic glutamate release as a function of postsynaptic activity. We propose that this molecular composition of the endocannabinoid system may be a general feature of most glutamatergic synapses throughout the brain and may contribute to homosynaptic plasticity of excitatory synapses and to heterosynaptic plasticity between excitatory and inhibitory contacts.