Lag1p and Lac1p are two homologous transmembrane proteins of the endoplasmic reticulum in Saccharomyces cerevisiae. Homologous genes have been found in a wide variety of eukaryotes. In yeast, both genes, LAC1 and LAG1, are required for efficient endoplasmic reticulum-to-Golgi transport of glycosylphosphatidylinositol-anchored proteins. In this study, we show that lag1 Delta lac1 Delta cells have reduced sphingolipid levels due to a block of the fumonisin B1-sensitive and acyl-CoA-dependent ceramide synthase reaction. The sphingolipid synthesis defect in lag1 Delta lac1 Delta cells can be partially corrected by overexpression of YPC1 or YDC1, encoding ceramidases that have been reported to have acyl-CoA-independent ceramide synthesis activity. Quadruple mutant cells (lag1 Delta lac1 Delta ypc1 Delta ydc1 Delta) do not make any sphingolipids, but are still viable probably because they produce novel lipids. Moreover, lag1 Delta lac1 Delta cells are resistant to aureobasidin A, an inhibitor of the inositolphosphorylceramide synthase, suggesting that aureobasidin A may be toxic because it leads to increased ceramide levels. Based on these data, LAG1 and LAC1 are the first genes to be identified that are required for the fumonisin B1-sensitive and acyl-CoA-dependent ceramide synthase reaction.