Sphingomyelinase (SMase) from Bacillus cereus (Bc-SMase) hydrolyzes sphingomyelin to phosphocholine and ceramide in a divalent metal ion-dependent manner. Bc-SMase is a homologue of mammalian neutral SMase (nSMase) and mimics the actions of the endogenous mammalian nSMase in causing differentiation, development, aging, and apoptosis. Thus Bc-SMase may be a good model for the poorly characterized mammalian nSMase. The metal ion activation of sphingomyelinase activity of Bc-SMase was in the order Co2+ > or = Mn2+ > or = Mg2+ >> Ca2+ > or = Sr2+. The first crystal structures of Bc-SMase bound to Co2+, Mg2+, or Ca2+ were determined. The water-bridged double divalent metal ions at the center of the cleft in both the Co2+- and Mg2+-bound forms were concluded to be the catalytic architecture required for sphingomyelinase activity. In contrast, the architecture of Ca2+ binding at the site showed only one binding site. A further single metal-binding site exists at one side edge of the cleft. Based on the highly conserved nature of the residues of the binding sites, the crystal structure of Bc-SMase with bound Mg2+ or Co2+ may provide a common structural framework applicable to phosphohydrolases belonging to the DNase I-like folding superfamily. In addition, the structural features and site-directed mutagenesis suggest that the specific beta-hairpin with the aromatic amino acid residues participates in binding to the membrane-bound sphingomyelin substrate.