Studies of invertebrate and vertebrate nervous tissue have demonstrated that free arachidonic acid and its lipoxygenase metabolites are produced in a receptor-dependent fashion. The intracellular actions of these compounds include the regulation of activity of membrane ion channels and protein kinases. In this article Daniele Piomelli and Paul Greengard review the evidence that these lipophilic molecules constitute a novel class of intracellular second messenger, possibly involved in the modulation of neurotransmitter release.