The phosphorylated sphingolipid metabolites sphingosine 1-phosphate (S1P) and ceramide 1-phosphate (C1P) have emerged as potent bioactive agents. Recent studies have begun to define new biological functions for these lipids. Generated by sphingosine kinases and ceramide kinase, they control numerous aspects of cell physiology, including cell survival and mammalian inflammatory responses. Interestingly, S1P is involved in cyclooxygenase-2 induction and C1P is required for the activation and translocation of cPLA2. This suggests that these two sphingolipid metabolites may act in concert to regulate production of eicosanoids, important inflammatory mediators. Whereas S1P functions mainly via G-protein-coupled receptors, C1P appears to bind directly to targets such as cPLA2 and protein phosphatase 1/2A. S1P probably also has intracellular targets, and in plants it appears to directly regulate the G protein alpha subunit GPA1.