Sphingomyelinases secreted by pathogenic bacteria play important roles in host-pathogen interactions ranging from interfering with phagocytosis and oxidative burst to iron acquisition. This study shows that the Mtb protein Rv0888 possesses potent sphingomyelinase activity cleaving sphingomyelin, a major lipid in eukaryotic cells, into ceramide and phosphocholine which are then utilized by Mtb as carbon, nitrogen and phosphorus sources, respectively. An Mtb rv0888 deletion mutant did not grow on sphingomyelin as a sole carbon source anymore and replicated poorly in macrophages indicating that Mtb utilizes sphingomyelin during infection. Rv0888 is an unusual membrane protein with a surface-exposed C-terminal sphingomyelinase domain and a putative N-terminal channel domain that mediated glucose and phosphocholine uptake across the outer membrane in an M. smegmatis porin mutant. Hence, we propose to name Rv0888 as SpmT (sphingomyelinase of M. tuberculosis). Erythrocyte membranes contain up to 27% sphingomyelin. The finding that Rv0888 accounts for half of Mtb's hemolysis is consistent with its sphingomyelinase activity and the observation that Rv0888 levels are increased in the presence of erythrocytes and sphingomyelin by 5- and 100-fold, respectively. Thus, Rv0888 is a novel outer membrane protein that enables Mtb to utilize sphingomyelin as a source of several essential nutrients during intracellular growth.