Orexin A and B are hypothalamic peptides known to modulate arousal, feeding, and reward via OX1 and OX<em>2</em> receptors. Orexins are also antinociceptive in the brain, but their mechanism(s) of action remain unclear. Here, we investigated the antinociceptive mechanism of orexin A in the rat ventrolateral periaqueductal gray (vlPAG), a midbrain region crucial for initiating descending pain inhibition. In vlPAG slices, orexin A (30-300 nm) depressed GABAergic evoked IPSCs. This effect was blocked by an OX1 [1-(<em>2</em>-methylbenzoxazol-6-yl)-3-[1,5]naphthyridin-4-yl urea (SB 334867)], but not OX<em>2</em> [N-acyl 6,7-dimethoxy-1,<em>2</em>,3,4-tetrahydroisoquinoline hydrochloride (compound <em>2</em>9)], antagonist. Orexin A increased the paired-pulse ratio of paired IPSCs and decreased the frequency, but not amplitude, of miniature IPSCs. Orexin A-induced IPSC depression was mimicked by (R)-(+)-[<em>2</em>,3-dihydro-5-methyl-3-(4-morpholinylmethyl)pyrrolo[1,<em>2</em>,3-de]-1,4-benzoxazin-6-yl]-1-napthalenylmethanone (WIN 55,<em>2</em>1<em>2</em>-<em>2</em>), a cannabinoid 1 (CB1) receptor agonist. 1-(<em>2</em>,4-Dichlorophenyl)-5-(4-iodophenyl)-4-methyl-N-(1-piperidyl)pyrazole-3-carboxamide (AM <em>2</em>51), a CB1 antagonist, reversed depressant effects by both agonists. Orexin A-induced IPSC depression was prevented by 1-[6-[[(17β)-3-methoxyestra-1,3,5(10)-trien-17-yl]amino]hexyl]-1H-pyrrole-<em>2</em>,5-dione (U731<em>2</em><em>2</em>) and tetrahydrolipstatin, inhibitors of phospholipase C (PLC) and diacylglycerol lipase (DAGL), respectively, and enhanced by cyclohexyl[1,1'-biphenyl]-3-ylcarbamate (URB60<em>2</em>), which inhibits enzymatic degradation of <em>2</em>-<em>arachidonoylglycerol</em> (<em>2</em>-AG). Moderate DAGLα, but not DAGLβ, immunoreactivity was observed in the vlPAG. Orexin A produced an overall excitatory effect on evoked postsynaptic potentials and hence increased vlPAG neuronal activity. Intra-vlPAG microinjection of orexin A reduced hot-plate nociceptive responses in rats in a manner blocked by SB 334867 and AM <em>2</em>51. Therefore, orexin A may produce antinociception by activating postsynaptic OX1 receptors, stimulating synthesis of <em>2</em>-AG, an endocannabinoid, through a Gq-protein-mediated PLC-DAGLα enzymatic cascade culminating in retrograde inhibition of GABA release (disinhibition) in the vlPAG.