Ceramide is the key intermediate in the biosynthesis of all complex sphingolipids. Due to its major role in maintaining the water-retaining properties of the epidermis, ceramide is of great commercial potential in cosmetic and pharmaceuticals such as hair and skin care products. Currently, chemical synthesis of ceramide is a costly and time consuming process, and developments of alternative cost-efficient, high yield production methods are of great interest. In the present, the potential of producing ceramide through the enzymatic hydrolysis of sphingomyelin have been studied. Sphingomyelin, which contains a ceramide moiety, is a ubiquitous component of animal cell membranes, and dairy products or by-products is a rich source of sphingomyelin. It has been verified that enzymatic modification of sphingomyelin is a feasible approach for production of ceramide. The reaction system has been optimized through system evaluation and the optimization of several important factors. Sphingomyelin hydrolysis proved to be more efficient in two-phase (water: organic solvent) system than in one-phase (water-saturated organic solvent) system. Phospholipase C from Clostridium perfringens is the tested enzyme which has the most advantageous properties. For reusing the enzyme, the immobilization of phospholipase C and the properties of immobilized enzyme have been addressed. By screening nine different carriers, we found that the enzyme immobilized on Lewatit VP OC 1600 (Bayer AG) have the highest catalytic activity. After seven recycles, immobilized enzyme retains around 70% of its initial activity. Through kinetic study, it has been found that the hydrolysis reactions catalyzed by both soluble and immobilized enzyme follow the Michaelis-Menten equation. The presentation will describe the research background, introduce the basic reaction system with its optimisation as well as the immobilization study, and release the recent results from the kinetic study.