ACER3 is a ceramidase enzyme encoded by the ACER3 gene.In cells, ACER3 overexpression decreased C_18:1- and C_20:1-ceramides and dihydroceramides, whereas ACER3 knockdown by RNA interference had the opposite effect, suggesting that ACER3 controls the catabolism of ULC ceramides and dihydroceramides. ACER3 knockdown inhibited cell apoptosis in response to serum deprivation. ACER3 knockdown up-regulated the expression of the alkaline ceramidase 2 (ACER2), and the ACER2 up-regulation decreased non-ULC ceramide species while increasing both sphingosine and its phosphate. Collectively, these data suggest that ACER3 catalyzes the hydrolysis of ULC ceramides and dihydroceramides and that ACER3 coordinates with ACER2 to regulate cell proliferation and survival.