Ceramides (Cers) accumulate within the interstices of the outermost epidermal layers, or stratum corneum (SC), where they represent critical components of the epidermal permeability barrier. Although the SC contains substantial sphingol, indicative of ceramidase (CDase) activity, which CDase isoforms are expressed in epidermis remains unresolved. We hypothesized here that CDase isoforms are expressed within specific epidermal compartments in relation to functions that localize to these layers. Keratinocytes/epidermis express all five known CDase isoforms, of which acidic and alkaline CDase activities increase significantly with differentiation, persisting into the SC. Conversely, neutral and phytoalkaline CDase activities predominate in proliferating keratinocytes. These differentiation-associated changes in isoform activity/protein are attributed to corresponding, differentiation-associated changes in mRNA levels (by quantitative RT-PCR). Although four of the five known CDase isoforms are widely expressed in cutaneous and extracutaneous tissues, alkaline CDase-1 occurs almost exclusively in epidermis. These results demonstrate large, differentiation-associated, and tissue-specific variations in the expression and activities of all five CDase isoforms. Because alkaline CDase-1 and acidic CDase are selectively upregulated in the differentiated epidermal compartment, they could regulate functions that localize to the distal epidermis, such as permeability barrier homeostasis and antimicrobial defense.