In this study, we analyzed the intracellular mechanisms leading to basic fibroblast growth factor (bFGF)-dependent production of NO in Chinese hamster ovary (CHO)-K1 cells and a possible physiological role for such an effect. bFGF induces NO production through the activation of the endothelial form of NO synthase (eNOS), causing a subsequent increase in the cGMP levels. In these cells, the activation of eNOS by bFGF is Ca(2+)- and mitogen-activated protein kinase-independent. The translocation of the enzyme from the plasma membrane, where it is located in caveolae bound to caveolin 1, to the cytosol is the crucial step for the synthesis of NO through the eNOS isoform. We demonstrate that bFGF activates a sphingomyelinase to synthesize ceramide, which, in turn, allows the dissociation of eNOS from caveolin 1 and its translocation to the cytosol in the active form, where it catalyzes the synthesis of NO. In fact, drugs interfering with sphingomyelinase activity blocked bFGF activation of eNOS, and an increase in ceramide content was detected after bFGF treatment. Moreover, in fibroblasts derived from patients with Niemann-Pick disease, in which the enzyme is genetically inactive, bFGF is unable to elicit eNOS activation. The NO produced after bFGF treatment, through the activation of guanylyl cyclase and protein kinase G, mediates a mitogen-activated protein kinase-independent cell proliferation. In conclusion, our data show that, in CHO-K1 cells, bFGF regulates the activity of eNOS through a novel intracellular pathway, involving the induction of ceramide synthesis and that the NO released participates in bFGF proliferative activity.