This study investigated the effects of the endocannabinoid, anandamide, on M(1) muscarinic acetylcholine receptors (mAChRs) expressed in Chinese hamster ovary (CHO) cells. In the presence of anandamide, [(3)H]N-methylscopolamine ([(3)H]NMS) inhibition binding was characterized by Hill coefficients greater than 1 while saturation binding isotherms were characterized by a reduction in radioligand B(max). Anandamide did not affect the potency of classic agonists, antagonists or allosteric modulators to inhibit [(3)H]NMS binding, indicating that the site of anandamide action did not involve receptor regions recognized by these compounds. Although the mode of binding of anandamide was reversible, the order of ligand addition was important; the inhibitory effect was greatest when anandamide was equilibrated with the receptor prior to radioligand addition, and weakest in the converse situation. Interestingly, the inhibitory potency of anandamide was reduced on pre-equilibration with non-transfected CHO cell membranes, prior to addition of M(1) mAChR-transfected membranes. In phosphoinositide (PI) hydrolysis assays, anandamide significantly reduced the maximal response to acetylcholine, but at higher concentrations than those needed to fully inhibit radioligand binding. Studies utilizing a range of agonists with varying intrinsic activities showed that the inhibitory effects of anandamide on agonist function were most pronounced with the lowest efficacy agonists. These findings suggest that the mechanism of action of anandamide at the M(1) mAChR involves perturbation of the receptor via the membrane in a manner that is sensitive to the conformation of the receptor (occupied versus vacant).