AbstractAcid sphingomyelinase (ASMase, ASM, SMPD1) converts sphingomyelin into ceramide, modulating membrane properties and signal transduction. Inactivating mutations in ASMase cause Niemann–Pick disease, and its inhibition is also beneficial in models of depression and cancer. To gain a better understanding of this critical therapeutic target, we determined crystal structures of mammalian ASMase in various conformations. The catalytic domain adopts a calcineurin-like fold with two zinc ions and a hydrophobic track leading to the active site. Strikingly, the membrane interacting saposin domain assumes either a closed globular conformation independent from the catalytic domain, or an open conformation, which establishes an interface with the catalytic domain essential for activity. Structural mapping of Niemann–Pick mutations reveals that most of them likely destabilize the protein’s fold. This study sheds light on the molecular mechanism of ASMase function, and provides a platform for the rational development of ASMase inhibitors and therapeutic use of recombinant ASMase.