Polyneuropathy, hearing loss, ataxia, retinitis pigmentosa, and cataract (PHARC) is a neurodegenerative disease marked by early-onset cataract and hearing loss, retinitis pigmentosa, and involvement of both the central and peripheral nervous systems, including demyelinating sensorimotor polyneuropathy and cerebellar ataxia. Previously, we mapped this Refsum-like disorder to a 16 Mb region on chromosome 20. Here we report that mutations in the ABHD12 gene cause PHARC disease and we describe the clinical manifestations in a total of 19 patients from four different countries. The ABHD12 enzyme was recently shown to hydrolyze 2-arachidonoyl glycerol (2-AG), the main endocannabinoid lipid transmitter that acts on cannabinoid receptors CB1 and CB2. Our data therefore represent an example of an inherited disorder related to endocannabinoid metabolism. The endocannabinoid system is involved in a wide range of physiological processes including neurotransmission, mood, appetite, pain appreciation, addiction behavior, and inflammation, and several potential drugs targeting these pathways are in development for clinical applications. Our findings show that ABHD12 performs essential functions in both the central and peripheral nervous systems and the eye. Any future drug-mediated interference with this enzyme should consider the potential risk of long-term adverse effects.