Acid sphingomyelinase (ASMase) is a key enzyme in sphingolipid metabolism, which can be activated by various cellular stress mechanisms including bacterial pathogens. Activation of ASMase generates ceramide, which is important for innate immune response to eliminate infected pathogens. The current study reveals a defective ASMase pathway after Pseudomonas aeruginosa infection in both a cystic fibrosis (CF) bronchial epithelial cell line (IB3-1 cell) and in the lungs of CF transmembrane conductance regulator (CFTR) knockout (KO) mice as compared with S9 cells and wild-type C57BL/6 mice. ASMase activity and total ceramide levels significantly increased in S9 cells and C57BL/6 mice with P. aeruginosa infection, but not in IB3-1 cells and CFTR KO mice. The silencing of CFTR by CFTR RNAi in S9 cells significantly decreased ASMase activity after bacterial infection as compared with controls. This study also demonstrates that induction of ASMase is responsible for modulating the immune response to bacterial infection. Blocking ASMase activity with specific ASMase RNAi, an ASMase inhibitor, or an ASMase antibody in S9 cells significantly increased IL-8 levels with P. aeruginosa infection compared with controls. Reciprocally, adding exogenous bacterial sphingomyelinase to IB3-1 cells significantly decreased IL-8 levels compared with untreated cells. In addition, silencing of ASMase in S9 cells also significantly decreased bacterial internalization. Adding exogenous bacterial sphingomyelinase to IB3-1 cells reconstituted the cell death response to P. aeruginosa infection. This study demonstrates that the defective ASMase pathway in CF is a key contributor to the unabated IL-8 response with P. aeruginosa infection and to the compromised host response failing to eradicate bacteria.