GH and IGF-I control over 80% of postnatal growth. We recently established that TNFα impairs the ability of IGF-I to increase protein synthesis and promote expression of myogenin in myoblasts. Here we extend these results by showing that ceramide, a second messenger in both TNFα and IL-1β receptor signaling pathways, is a key downstream sphingosine-based lipid that leads to IGF-I resistance. A cellpermeable ceramide analog, C2-ceramide, inhibits IGF-I-induced protein synthesis by 65% and blocks the ability of IGF-I to increase expression of two key myogenic factors, myogenin and MyoD. Identical results were obtained with both TNFα and IL-1β (1 ng/ml). Consistent with these data, neutral sphingomyelinase (N-SMase), an enzyme that catalyzes formation of ceramide from sphingomyelin, blocks IGF-I-induced protein synthesis and expression of both myogenin and MyoD. The possibility that cytokine-induced ceramide production is required for disruption of IGF-I biologic activity was confirmed by treating C₂C₁₂ myoblasts with inhibitors of all three ceramide-generating pathways. A N-SMase inhibitor, glutathione, as well as an acidic sphingomyelinase (A-SMase) inhibitor, D609, reverse the cytokine inhibition of IGF-I-induced protein synthesis by 80% and 45%, respectively. Likewise, an inhibitor of de novo ceramide synthesis, FB₁, causes a 50% inhibition. Similarly, all three inhibitors significantly impair the ability of both TNFα and IL-1β to suppress IGF-I-driven expression of myogenin. These experiments establish that ceramide, derived both from sphingomyelin and de novo synthesis, is a key intermediate by which proinflammatory cytokines impair the ability of IGF-I to promote protein synthesis and expression of critical muscle-specific transcription factors.