The hydrolysis of sphingomyelin (SM) generates important signals regulating cell proliferation and apoptosis. Acid and neutral sphingomyelinases (SMase) have been identified and their biological effects intensively studied. We recently found in human bile a novel alkaline SMase that may have important roles in hepatobiliary diseases. In this work, we purified the enzyme and studied the factors influencing enzyme activity. Purification steps included Sephadex G25, diethylaminoethyl (DEAE)-Sepharose, Sephacryl S-200, and sphingosylphosphorylcholine (SPC) affinity chromatographies. A single protein of 92 kd was obtained with the specific enzyme activity increased 1,154-fold. The enzyme specifically hydrolyzed SM to ceramide, had a weaker activity against phosphatidylcholine (PC), and no activity against either phosphatidylethanolamine (PE) or p-nitrophenyl phosphate. Its optimum pH was 9.0 and its Vmax and Km were 45 micromol/h/mg and 2.5 × 10-5 mol/L, respectively. The enzyme activity was dependent on concentration and structure of bile salts. Both trihydroxy and dihydroxy bile salts at concentrations up to their critical micellar concentrations activated the alkaline SMase, trihydroxy bile salts being more potent than dihydroxy ones. The side chain of trihydroxy bile salts was also important. Taurocholate (TC) was most effective in activating SMase, followed by glycocholate (GC), and cholate. 3-((3-cholamidopropyl)dimethylammonio)-propanesulfonate (CHAPS) alone had no effect on SMase activity but inhibited TC-induced activation of SMase. PC competitively inhibited bile alkaline SMase activity, with the 50% inhibition occurring at a PC/SM ratio of approximately 28. In conclusion, we purified a novel alkaline SMase from human bile and found that its activity is dependent on the levels of two major biliary components: PC and bile salts.