Fatty acid ethanolamides (FAEs), which include palmitoylethanolamide (PEA) and oleoylethanolamide (OEA), are endogenous agonists of peroxisome proliferator-activated receptor-α (PPAR-α) and important regulators of the inflammatory response. They are degraded in macrophages by the lysosomal cysteine amidase, N-acylethanolamine acid amidase (NAAA). Previous studies have shown that pharmacological inhibition of NAAA activity suppresses macrophage activation in vitro and causes marked anti-inflammatory effects in vivo, which is suggestive of a role for NAAA in the control of inflammation. It is still unknown, however, whether NAAA-mediated FAE deactivation might regulate pain signaling. The present study examined the effects of ARN077, a potent and selective NAAA inhibitor recently disclosed by our group, in rodent models of hyperalgesia and allodynia caused by inflammation or nerve damage. Topical administration of ARN077 attenuated, in a dose-dependent manner, heat hyperalgesia and mechanical allodynia elicited in mice by carrageenan injection or sciatic nerve ligation. The antinociceptive effects of ARN077 were prevented by the selective PPAR-α antagonist GW6471 and did not occur in PPAR-α-deficient mice. Furthermore, topical ARN077 reversed the allodynia caused by ultraviolet B radiation in rats, and this effect was blocked by pretreatment with GW6471. Sciatic nerve ligation or application of the proinflammatory phorbol ester 12-O-tetradecanoylphorbol 13-acetate decreased FAE levels in sciatic nerve and skin tissue, respectively. ARN077 reversed these biochemical effects. The results identify ARN077 as a potent inhibitor of intracellular NAAA activity, which is active in vivo by topical administration. The findings further suggest that NAAA regulates peripheral pain initiation by interrupting endogenous FAE signaling at PPAR-α.