The possibility that the sphingomyelin (SM)-ceramide pathway is activated by CD40, a transmembrane glycoprotein belonging to the tumor necrosis factor receptor superfamily and that plays a critical role in the regulation of immune responses has been investigated. We demonstrate that incubation of Epstein-Barr virus-transformed lymphoid cells with an anti-CD40 antibody acting as an agonist results in the stimulation of a neutral sphingomyelinase, hydrolysis of cellular SM, and concomitant ceramide generation. In addition, SM degradation was observed in acid sphingomyelinase-deficient cells, as well as after ligation by soluble CD40 ligand. The anti-CD40 antibody, as well as the soluble CD40 ligand induced a decrease in thymidine incorporation and morphological features of apoptosis, which were mimicked by cell-permeant or bacterial sphingomyelinase-produced ceramides. Stable expression of a dominant-negative form of the FAN protein (factor associated with neutral sphingomyelinase activation), which has been reported to mediate tumor necrosis factor-induced activation of neutral sphingomyelinase, significantly inhibited CD40 ligand-induced sphingomyelinase stimulation and apoptosis of transformed human fibroblasts. Transformed fibroblasts from FAN knockout mice were also protected from CD40-mediated cell death. Finally, anti-CD40 antibodies were able to co-immunoprecipitate FAN in control fibroblasts but not in cells expressing the dominant-negative form of FAN, indicating interaction between CD40 and FAN. Altogether, these results strongly suggest that CD40 ligation can activate via FAN a neutral sphingomyelinase-mediated ceramide pathway that is involved in the cell growth inhibitory effects of CD40.