Current studies indicate that ceramide is involved in the regulation of important cell functions, namely cell growth, differentiation, and apoptosis. In the present study, the possible role of ceramide in the differentiation of neuroblastoma Neuro2a cells was investigated. The following results were obtained. (a) Ceramide content of Neuro2a cells, induced to differentiate by retinoic acid (RA) treatment rapidly increased after addition of RA, was maintained at high levels in RA-differentiated cells and returned to the starting levels with removal of RA and reversal of differentiation; under the same conditions, the sphingosine content remained unchanged. (b) After a short pulse with [3H]sphingomyelin or [3H]sphingosine or L-[3H]serine, the metabolic formation of ceramide was markedly higher and more rapid in RA-differentiated than undifferentiated cells. (c) Inhibitors of ceramide biosynthesis (Fumonisin B1, beta-chloroalanine and L-cycloserine) diminished the extent of the differentiating effect of RA and concomitantly Cer content decreased. (d) The activity of neutral sphingomyelinase increased after addition of RA, maintained high levels in RA-differentiated cells, and returned to the initial levels with removal of RA. (e) Experimental conditions that cause an elevation of ceramide content (treatment with sphingosine or ceramide or C2-ceramide or bacterial sphingomyelinase) inhibited cell proliferation and stimulated neurite outgrowth; dihydro-analogues of sphingosine, ceramide, and C2-ceramide had no effect on differentiation. (f) treatment with Fumonisin B1 completely inhibited sphingosine-induced differentiation. These data suggest a specific bioregulatory function of ceramide in the control of Neuro2a cell growth and differentiation and pose the general hypothesis of a mediator role of ceramide in the differentiation of cells of neural origin.