In this study, we examined the role of endogenous ceramide in the inhibition of telomerase and induction of morphologic differentiation in response to all-trans-retinoic acid (ATRA) in the SK-N-SH and SK-N-AS human neuroblastoma cell lines. The results showed that ATRA inhibited the activity of telomerase significantly in a time- and dose-dependent manner, as determined by telomere repeat amplification protocol (TRAP). The inhibition of telomerase by ATRA was maximum (about 50-80% of untreated controls) at 5-10 microM for 4-8 days. Treatment of cells with ATRA (5 microM) also resulted in the inhibition of growth by about 30-70% after 4 and 8 days of treatment, respectively, which was measured by trypan blue exclusion method. Measurement of accumulation of endogenous ceramide by high pressure liquid chromatography coupled with mass spectroscopy (LC/MS) showed that treatment of cells with ATRA resulted in increased levels of mainly C24:0 and C24:1 ceramides at days 2, 4, and 8, respectively. Also, treatment of cells with ATRA in the presence of myriocin blocked the accumulation of ceramide significantly, and more importantly, presence of myriocin partially prevented the inhibition of telomerase. Mechanistically, inhibition of telomerase by endogenous ceramide in response to ATRA treatment involves, at least in part, down-regulation of the expression of telomerase reverse transcriptase (hTERT) mRNA, as determined by semi-quantitative RT-PCR, in these cells. In addition, the modulation of telomerase activity by ATRA correlated with the induction of morphologic differentiation, which was also blocked by myriocin, as determined by extension of neurites using phase-contrast microscopy. These results, therefore, reveal an important effect of ATRA on telomerase inhibition and induction of morphologic differentiation in human neuroblastoma cells. These data also demonstrate that endogenous ceramide is one of the upstream regulators of telomerase activity in human neuroblastoma cells in response to ATRA.