Sphingolipids are signaling molecules which influence diverse cellular functions from control of the cell cycle to degradation of plasma membrane proteins. The synthetic sphingolipid-like compound, FTY720 is an immuno-modulating agent in clinical trials for transplant graft maintenance. In this report, we compare the effects of the natural yeast sphingolipid molecule phytosphingosine with FTY720 in Saccharomyces cerevisiae. We show that the multicopy suppressor genes which induce growth resistance to FTY720 also confer resistance to growth-inhibitory concentrations of phytosphingosine. In addition, mutants for ubiquitination pathway proteins are shown to be resistant to the growth inhibiting effect of both FTY720 and phytosphingosine. We observe fewer similarities between sphingosine, the mammalian analogue of phytosphingosine and FTY720 than between FTY720 and phytosphingosine as revealed by genetic studies. Yeast cells lacking the specific sphingosine kinase LCB4 are sensitive to phytosphingosine and FTY720 but resistant to sphingosine suggesting that FTY720 and phytosphingosine have a related mechanism of action. Gene expression profile comparisons of sensitive and resistant yeast cells exposed to FTY720 and phytosphingosine highlight a number of similarities. In response to treatment with these compounds, about 77% of the genes which are regulated more than 2 fold by FTY720 also respond to PHS in the same direction in the parent strain. In addition, a close inspection of TAT1 and TAT2 transporters following exposure to phytosphingosine indicates that TAT1 protein is degraded in a similar fashion upon treatment with FTY720 and PHS. There were differences, however, with respect to TAT2 protein level and the expression profiles of a subset of genes. The genetic, transcriptional and biochemical data together indicate that FTY720 and phytosphingosine influence similar pathways in yeast cells. These findings offer further insights into the physiological pathways influenced by these compounds in all eukaryotic cells and help understand the therapeutic consequences of the immuno-modulator, FTY720 in humans.