Sphingosine 1‐phosphate (SPP) is an important sphingolipid‐derived second messenger in mammalian cells that acts to promote proliferation and to inhibit apoptosis. Various growth factors increase the intracellular concentration of SPP by activating sphingosine kinase, the molecular cloning of which has revealed that it defines a new type of lipid kinase. Cell fate is influenced by the balance between the intracellular concentration of SPP and that of ceramide, a pro‐apoptotic sphingolipid metabolite. The observation that a similar “rheostat” is a determinant of cell survival in yeast cells exposed to heat shock indicates that it is an evolutionarily conserved mechanism of stress regulation. SPP also acts extracellularly to inhibit cell motility and to influence cell morphology, effects that appear to be mediated by the G protein‐coupled receptor EDG1. These observations indicate that SPP is the prototype of a new class of lipid mediators that exert both intracellular and extracellular actions. J. Leukoc. Biol. 65: 341–344; 1999.