Dihydrosphingosine, an intermediate in the de novo synthesis of ceramide, induced proliferation of Swiss 3T3 cells. The proliferative effects of this lipid were much more potent than those of sphingosine, a break-down product of ceramide. The maximal proliferative response to dihydrosphingosine occurred at relatively low concentrations (1 microM), while sphingosine produced its maximal effect at much higher concentrations (15 microM). The cell-permeable ceramide, N-hexanoylsphingosine (C6-ceramide), which was also a mitogen in these cells (at 1 microM), caused a striking morphological change when added to the cells at concentrations of 5-10 microM. This shape change was reversible with the removal of ceramide. Exogenous dihydrosphingosines and sphingosines have at least two metabolic fates in Swiss 3T3 cells, conversion to ceramide or to sphingosine 1-phosphate. Surprisingly, both the synthetic threo- isomer and the naturally occurring erythro- isomer of dihydrosphingosine and sphingosine (D-erythro-sphingosine, L-threo-sphingosine, DL-threo-dihydrosphingosine, and DL-erythro-dihydrosphingosine) were readily phosphorylated in intact Swiss 3T3 cells. This substrate specificity may be an indication of a sphingosine kinase activity which is distinct from that of platelets or rat brain. Although sphingosine 1-phosphate and ceramide were both produced upon the addition of sphingosine and dihydrosphingosine, no sphingosine 1-phosphate was produced when Swiss 3T3 cells were treated with mitogenic concentrations of C6-ceramide. These data are consistent with the formation of ceramide and not sphingosine 1-phosphate being required for the mitogenesis produced by exogenous sphingoid bases.