The homeostatic regulation of serine palmitoyltransferase (SPT) activity in yeast involves N-terminal phosphorylation of Orm proteins, while higher eukaryotes lack these phosphorylation sites. Although recent studies have indicated a conserved ceramide-mediated feedback inhibition of the SPT-ORM/ORMDL complex in higher eukaryotes, its conservation and relationship with phosphorylation regulation in yeast remain unclear. Here, we determine the structure of the yeast SPT-Orm2 complex in a dephosphomimetic state and identify an evolutionarily conserved ceramide-sensing site. Ceramide stabilizes the dephosphomimetic Orm2 in an inhibitory conformation, facilitated by an intramolecular β-sheet between the N- and C-terminal segments of Orm2. Moreover, we find that a phosphomimetic mutant of Orm2, positioned adjacent to its intramolecular β-sheet, destabilizes the inhibitory conformation of Orm2. Taken together, our findings suggest that both Orm dephosphorylation and ceramide binding are crucial for suppressing SPT activity in yeast. This highlights a distinctive regulatory mechanism in yeast involving the collaborative actions of phosphorylation and ceramide.