Acid ceramidase (AC) is a lysosomal cysteine amidase that controls sphingolipid signaling by lowering the levels of ceramides and concomitantly increasing those of sphingosine and its bioactive metabolite, sphingosine 1-phosphate. In the present study, we evaluated the role of AC-regulated sphingolipid signaling in melanoma. We found that AC expression is markedly elevated in normal human melanocytes and proliferative melanoma cell lines, compared with other skin cells (keratinocytes and fibroblasts) and non-melanoma cancer cells. High AC expression was also observed in biopsies from human subjects with Stage II melanoma. Immunofluorescence studies revealed that the subcellular localization of AC differs between melanocytes (where it is found in both cytosol and nucleus) and melanoma cells (where it is primarily localized to cytosol). In addition to having high AC levels, melanoma cells generate lower amounts of ceramides than normal melanocytes do. This down-regulation in ceramide production appears to result from suppression of the de novo biosynthesis pathway. To test whether AC might contribute to melanoma cell proliferation, we blocked AC activity using a new potent (IC50 = 12 nM) and stable inhibitor. AC inhibition increased cellular ceramide levels, decreased sphingosine 1-phosphate levels, and acted synergistically with several, albeit not all, antitumoral agents. The results suggest that AC-controlled sphingolipid metabolism may play an important role in the control of melanoma proliferation.