Although we have accumulated few data that would definitely designate the role of N-SMase in modern cell biology, current evidence indicates that N-SMase may play a central role in signal transduction (Fig. 7). Biomodulators such as hormones, antibiotics, drugs, growth factors, and lipoproteins may interact with N-SMase either directly or in combination with other components (receptors) on the cell surface. The cell surface topology would provide easy access for such interactions. According to our hypothetical model shown in Fig. 7, activation of N-SMase via biomodulators, e.g., TNF-alpha, leads to the mobilization of cell surface cholesterol to the interior of the cell. We speculate that this process may be facilitated by sterol carrier proteins. This phenomenon may alter the lipid bilayer and make N-SMase accessible to its substrate, sphingomyelin. Ceramide released as a consequence of N-SMase reaction would then carry out various biological phenomena, such as cell proliferation and differentiation. Cholesterol on the other hand, may undergo oxidation and inhibit HMG-CoA reductase activity; it may also be utilized by ACAT to form cholesteryl esters. A decrease in cell membrane cholesterol levels may stimulate LDL receptor activity and LDL receptor recycling and/or synthesis. In contrast, inactivation or decreased activity of N-SMase, as in the case of gentamicin-treated cells, may have the opposite effect, i.e., decreased LDL receptor activity and decreased cholesteryl ester synthesis. Thus, N-SMase may indirectly modulate cholesterol metabolism in cells independent of LDL. It can also modify LDL, allowing its rapid uptake and foam cell formation in macrophages. We can safely conclude that N-SMase action may be required to carry out a myriad of important cellular functions either directly or by cholesterol mobilization, or generation of ceramide, ceramide-1-phosphate, and sphingoid bases. The present data support the view that N-SMase action may initiate signal transduction for such biomodulators as growth factors, lipoprotein, and hormones.