Palmitoylethanolamide was discovered in 1957. Indications for its use as an anti-inflammatory and analgesic date from before 1980. In that year, researchers described what they called "N-(2-hydroxyethyl)-palmitamide" as a natural anti-inflammatory agent, stating, "We have succeeded in isolating a crystalline anti-inflammatory factor from soybean lecithin and identifying it as (S)-(2-hydroxyethyl)-palmitamide. The compound also was isolated from a phospholipid fraction of egg yolk and from hexane-extracted peanut meal."
In 1975, Czech physicians described the results of a clinical trial looking at  joint pain, where the analgesic action of aspirin versus PEA were tested; both drugs were reported to enhance joint movements and decrease pain. In 1970 the drug manufacturer Spofa in Czechoslovakia introduced Impulsin, a tablet dose of PEA, for the treatment and prophylaxis of influenza and other respiratory infections. In Spain, the company Almirall introduced Palmidrol in tablet and suspension forms in 1976, for the same indications. 
In the mid-1990s, the relationship between anandamide and PEA was described; the expression of mast cell receptors sensitive to the two molecules was demonstrated by Levi-Montalcini and coworkers. During this period, more insight into the functions of endogenous fatty acid derivatives emerged, and compounds such as oleamide, palmitoylethanolamide, 2-lineoylglycerol and 2-palmitoylglycerol were explored for their capacity to modulate pain sensitivity and inflammation via what at that time was thought to be the endocannabinoid signalling pathway.
Primary reports also have provided evidence that PEA downregulates hyperactive mast cells in a dose-dependent manner, and that it alleviates pain elicited in mouse models. PEA and related compounds such as anandamide also seem to have synergistic effects in models of pain and analgesia.