Lysophosphatidic acid (LPA) is a bioactive lipid with activity in the nervous system mediated by G-protein-coupled receptors. Here, we examined the role of LPA signaling in the development of neuropathic pain by pharmacological and genetic approaches, including the use of mice lacking the LPA₁ receptor. Wild-type animals with nerve injury develop behavioral allodynia and hyperalgesia paralleled by demyelination in the dorsal root and increased expression of both the protein kinase C γ-isoform within the spinal cord dorsal horn and the α₂δ₁ calcium channel subunit in dorsal root ganglia. Intrathecal injection of LPA induced behavioral, morphological and biochemical changes similar to those observed after nerve ligation. In contrast, mice lacking a single LPA receptor (LPA₁, also known as EDG2) that activates the Rho–Rho kinase pathway do not develop signs of neuropathic pain after peripheral nerve injury. Inhibitors of Rho and Rho kinase also prevented these signs of neuropathic pain. These results imply that receptor-mediated LPA signaling is crucial in the initiation of neuropathic pain.