Mechanisms that alter protein phosphatase 2A (PP2A)-dependent lung tumour suppression via the I2PP2A/SET oncoprotein are unknown. We show here that the tumour suppressor ceramide binds I2PP2A/SET selectively in the nucleus and including its K209 and Y122 residues as determined by molecular modelling/simulations and site-directed mutagenesis. Because I2PP2A/SET was found overexpressed, whereas ceramide was downregulated in lung tumours, a sphingolipid analogue drug, FTY720, was identified to mimick ceramide for binding and targeting I2PP2A/SET, leading to PP2A reactivation, lung cancer cell death, and tumour suppression in vivo. Accordingly, while molecular targeting of I2PP2A/SET by stable knockdown prevented further tumour suppression by FTY720, reconstitution of WT-I2PP2A/SET expression restored this process. Mechanistically, targeting I2PP2A/SET by FTY720 mediated PP2A/RIPK1-dependent programmed necrosis (necroptosis), but not by apoptosis. The RIPK1 inhibitor necrostatin and knockdown or genetic loss of RIPK1 prevented growth inhibition by FTY720. Expression of WT- or death-domain-deleted (DDD)-RIPK1, but not the kinase-domain-deleted (KDD)-RIPK1, restored FTY720-mediated necroptosis in RIPK1−/− MEFs. Thus, these data suggest that targeting I2PP2A/SET by FTY720 suppresses lung tumour growth, at least in part, via PP2A activation and necroptosis mediated by the kinase domain of RIPK1.