The acid sphingomyelinase (aSMase) gene gives rise to two distinct enzymes, lysosomal sphingomyelinase (L-SMase) and secretory sphingomyelinase (S-SMase), via differential trafficking of a common protein precursor. However, the regulation of S-SMase and its role in cytokine-induced ceramide formation remain ill defined. To determine the role of S-SMase in cellular sphingolipid metabolism, MCF7 breast carcinoma cells stably transfected with V5-aSMase(WT) were treated with inflammatory cytokines. Interleukin-1β and tumor necrosis factor-α induced a time- and dose-dependent increase in S-SMase secretion and activity, coincident with selective elevations in cellular C(16)-ceramide. To establish a role for S-SMase, we utilized a mutant of aSMase (S508A) that is shown to retain L-SMase activity, but is defective in secretion. MCF7 expressing V5-aSMase(WT) exhibited increased S-SMase and L-SMase activity, as well as elevated cellular levels of specific long-chain and very long-chain ceramide species relative to vector control MCF7. Interestingly, elevated levels of only certain very long-chain ceramides were evident in V5-aSMase(S508A) MCF7. Secretion of the S508A mutant was also defective in response to IL-1β, as was the regulated generation of C(16)-ceramide. Taken together, these data support a crucial role for Ser(508) in the regulation of S-SMase secretion, and they suggest distinct metabolic roles for S-SMase and L-SMase.