Sphingomyelin (SM) biosynthesis represents a complex, finely regulated process, mostly occurring in vertebrates. It is intimately linked to lipid transport and it is ultimately carried out by two enzymes, SM synthase 1 and 2, selectively localized in the Golgi and plasma membrane. In the course of the SM biosynthetic reaction, various lipids are metabolized. Because these lipids have both structural and signaling functions, the SM biosynthetic process has the potential to affect diverse important cellular processes (such as cell proliferation, cell survival, and migration). Thus defects in SM biosynthesis might directly or indirectly impact the normal physiology of the cell and eventually of the organism. In this chapter, we will focus on evidence supporting a role for SM biosynthesis in specific cellular functions and how its dysregulation can affect neoplastic transformation.