In yeast, the long-chain sphingoid base phosphate phosphohydrolase Lcb3p is required for efficient ceramide synthesis from exogenous sphingoid bases. Similarly, in this study, we found that incorporation of exogenous sphingosine into ceramide in mammalian cells was regulated by the homologue of Lcb3p, sphingosine-1-phosphate phosphohydrolase 1 (SPP-1), an endoplasmic reticulum resident protein. Sphingosine incorporation into endogenous long-chain ceramides was increased by SPP-1 overexpression, whereas recycling of C(6)-ceramide into long-chain ceramides was not altered. The increase in ceramide was inhibited by fumonisin B(1), an inhibitor of ceramide synthase, but not by ISP-1, an inhibitor of serine palmitoyltransferase, the rate-limiting step in the de novo biosynthesis of ceramide. Mass spectrometry analysis revealed that SPP-1 expression increased the incorporation of sphingosine into all ceramide acyl chain species, particularly enhancing C16:0, C18:0, and C20:0 long-chain ceramides. The increased recycling of sphingosine into ceramide was accompanied by increased hexosylceramides and, to a lesser extent, sphingomyelins. Sphingosine kinase 2, but not sphingosine kinase 1, acted in concert with SPP-1 to regulate recycling of sphingosine into ceramide. Collectively, our results suggest that an evolutionarily conserved cycle of phosphorylation-dephosphorylation regulates recycling and salvage of sphingosine to ceramide and more complex sphingolipids.