Monoglyerides (MGs) are short-lived, intermediary lipids deriving from the degradation of phospho- and neutral lipids, and monoglyceride lipase (MGL), also designated as monoacylglycerol lipase (MAGL), is the major enzyme catalyzing the hydrolysis of MGs into glycerol and fatty acids. This distinct function enables MGL to regulate a number of physiological and pathophysiological processes since both MGs and fatty acids can act as signaling lipids or precursors thereof. The most prominent MG species acting as signaling lipid is 2-arachidonoyl glycerol (2-AG) which is the most abundant endogenous agonist of cannabinoid receptors in the body. Importantly, recent observations demonstrate that 2-AG represents a quantitatively important source for arachidonic acid, the precursor of prostaglandins and other inflammatory mediators. Accordingly, MGL-mediated 2-AG degradation affects lipid signaling by cannabinoid receptor-dependent and independent mechanisms. Recent genetic and pharmacological studies gave important insights into MGL's role in (patho-)physiological processes, and the enzyme is now considered as a promising drug target for a number of disorders including cancer, neurodegenerative and inflammatory diseases. This review summarizes the basics of MG (2-AG) metabolism and provides an overview on the therapeutic potential of MGL.