The key host cellular pathway(s) necessary to control the infection caused by inhalation of the environmental fungal pathogen Cryptococcus neoformans are still largely unknown. Here we have identified that the sphingolipid pathway in neutrophils is required for them to exert their killing activity on the fungus. In particular, using both pharmacological and genetic approaches, we show that inhibition of sphingomyelin synthase (SMS) activity profoundly impairs the killing ability of neutrophils by preventing the extracellular release of an antifungal factor(s). We next found that inhibition of protein kinase D (PKD), which controls vesicular sorting and secretion and is regulated by diacylglycerol (DAG) produced by SMS, totally blocks the extracellular killing activity of neutrophils against C. neoformans. The expression of SMS genes, SMS activity and the levels of the lipids regulated by SMS (namely sphingomyelin (SM) and DAG) are up-regulated during neutrophil differentiation. Finally, tissue imaging of lungs infected with C. neoformans using matrix-assisted laser desorption-ionization mass spectrometry (MALDI-MS), revealed that specific SM species are associated with neutrophil infiltration at the site of the infection. This study establishes a key role for SMS in the regulation of the killing activity of neutrophils against C. neoformans through a DAG-PKD dependent mechanism, and provides, for the first time, new insights into the protective role of host sphingolipids against a fungal infection.