Mg(2+)-dependent neutral SMases (NSMases) have emerged as prime candidates for stress-induced ceramide production. Among isoforms identified, previous reports have suggested the importance of NSMase2. However, its activation mechanism has not been precisely reported. Here, we analyzed the mechanism of NSMase2 gene expression by the anti-cancer drug, daunorubicin (DA). DA increased cellular ceramides (C16, C18 and C24) and NSMase activity of a human breast cancer cell line, MCF-7. DA remarkably increased the NSMase2 message and protein, whereas little change in NSMase1 and NSMase3 mRNAs and only a mild increase in acid SMase mRNA were observed. Overexpression and a knock down of NSMase2 indicated that NSMase2 played a role in DA-induced cell death. NSMase2 promoter analysis revealed that three Sp1 motifs located between -148 and -42bp upstream of the first exon were important in basic as well as in DA-induced promoter activity. Consistently, luciferase vectors containing three consensus Sp1-motifs but not its mutated form showed DA-induced transcriptional activation. DA-treated MCF-7 showed increased Sp3 protein. In SL2 cells lacking Sp family proteins, both Sp1 and Sp3 overexpression increased NSMase promoter activity. Increased binding of Sp family proteins by DA to three Sp1 motifs was shown by electrophoresis mobility shift and ChIP assays.