Serine palmitoyltransferase (SPT) long-chain base subunit 1 (SPTLC1) is 1 of the 2 main catalytic subunits of the SPT complex, which catalyzes the first and rate-limiting step of sphingolipid biosynthesis. Here, we show that Sptlc1 deletion in adult bone marrow (BM) cells results in defective myeloid differentiation. In chimeric mice from noncompetitive BM transplant assays, there was an expansion of the Lin- c-Kit+ Sca-1+ compartment due to increased multipotent progenitor production, but myeloid differentiation was severely compromised. We also show that defective biogenesis of sphingolipids in the endoplasmic reticulum (ER) leads to ER stress that affects myeloid differentiation. Furthermore, we demonstrate that transient accumulation of fatty acid, a substrate for sphingolipid biosynthesis, could be partially responsible for the ER stress. Independently, we find that ER stress in general, such as that induced by the chemical thapsigargin or the fatty acid palmitic acid, compromises myeloid differentiation in culture. These results identify perturbed sphingolipid metabolism as a source of ER stress, which may produce diverse pathological effects related to differential cell-type sensitivity.