Lag1p and Lac1p are two highly homologous membrane proteins of the endoplasmic reticulum. lag1delta lac1delta double mutants in Saccharomyces cerevisiae lack an acyl-CoA-dependent ceramide synthase and are either very sick or nonviable, depending on the genetic background. LAG1 and LAC1 are members of a large eukaryotic gene family that shares the Lag1 motif, and some members of this family additionally contain a DNA-binding HOX homeodomain. Here we show that several human LAG1 homologues can rescue the viability of lag1delta lac1delta yeast cells and restore acyl-CoA-dependent ceramide and sphingolipid biosynthesis. When tested in a microsomal assay, Lac1p and Lag1p had a strong preference for C26:0-CoA over C24:0-CoA, C20-CoA, and C16-CoA, whereas some human homologues preferred C24:0-CoA and CoA derivatives with shorter fatty acids. This suggests that LAG1 proteins are related to substrate recognition and to the catalytic activity of ceramide synthase enzymes. CLN8, another human LAG1 homologue implicated in ceroid lipofuscinosis, could not restore viability to lag1delta lac1delta yeast mutants.