Synchronized preimplantation embryo development and passage through the oviduct into the uterus are prerequisites for implantation, dysregulation of which often leads to pregnancy failure in women. Cannabinoid/endocannabinoid signaling via cannabinoid receptor CB1 is known to influence early pregnancy. Here we provide evidence that a critical balance between anandamide synthesis by N-acylphosphatidylethanolamine-selective phospholipase D (NAPE-PLD) and its degradation by fatty acid amide hydrolase (FAAH) in mouse embryos and oviducts creates locally an appropriate "anandamide tone" for normal development of embryos and their oviductal transport. FAAH inactivation yielding higher anandamide or experimentally induced higher cannabinoid [(-)-Delta9-tetrahydrocannabinol] levels constrain preimplantation embryo development with aberrant expression of Cdx2, Nanog, and Oct3/4, genes known to direct lineage specification. Defective oviductal embryo transport arising from aberrant endocannabinoid signaling also led to deferred on-time implantation and poor pregnancy outcome. Intercrossing between wild-type and Faah-/- mice rescued developmental defects, not oviductal transport, implying that embryonic and maternal FAAH plays differential roles in these processes. The results suggest that FAAH is a key metabolic gatekeeper, regulating on-site anandamide tone to direct preimplantation events that determine the fate of pregnancy. This study uncovers what we believe to be a novel regulation of preimplantation processes, which could be clinically relevant for fertility regulation in women.