Serine palmitoyltransferase, 3-dehydrosphinganine reductase and sphinganine N-acyltransferase are responsible for the first steps in sphingolipid biosynthesis forming 3-oxosphinganine, sphinganine, and dihydroceramide, respectively. We confirmed the localization of these enzymes in the endoplasmic reticulum (ER) using highly purified mouse liver ER and Golgi preparations. Mild digestion of sealed “right-side out” mouse liver ER derived vesicles with different proteolytic enzymes under conditions where latency of mannose-6-phosphatase was 90% produced approximately 60-80% inactivation of serine palmitoyltransferase, 3-dehydrosphinganine reductase, and sphinganine N-acyltransferase activities. These sphingolipid biosynthetic activities (serine palmitoyltransferase, 3-dehydrosphinganine reductase, and sphinganine N-acyltransferase) are not latent, indicating that they face the cytosolic side of the ER, so that substrates have free access to their active sites. Moreover, the membrane-impermeable compound, 4,4‘-diisothiocyanostilbene-2,2‘-disulfonic acid, which binds to a large number of ER proteins, inhibits serine palmitoyltransferase and sphinganine N-acyltransferase activities by 30-70%.