The subendothelial aggregation and retention of low density lipoprotein (LDL) are key events in atherogenesis, but the mechanisms in vivo are not known. Previous studies have shown that treatment of LDL with bacterial sphingomyelinase (SMase) in vitro leads to the formation of lesion-like LDL aggregates that become retained on extracellular matrix and stimulate macrophage foam cell formation. In addition, aggregated human lesional LDL, but not unaggregated lesional LDL or plasma LDL, shows evidence of hydrolysis by an arterial wall SMase in vivo, and several arterial wall cell types secrete a SMase (S-SMase). S-SMase, however, has a sharp acid pH optimum using a standard in vitro SM-micelle assay. Thus, a critical issue regarding the potential role of S-SMase in atherogenesis is whether the enzyme can hydrolyze lipoprotein-SM, particularly at neutral pH. We now show that S-SMase can hydrolyze and aggregate native plasma LDL at pH 5.5 but not at pH 7.4. Remarkably, LDL modified by oxidation, treatment with phospholipase A2, or enrichment with apolipoprotein CIII, which are modifications associated with increased atherogenesis, is hydrolyzed readily by S-SMase at pH 7.4. In addition, lipoproteins from the plasma of apolipoprotein E knock-out mice, which develop extensive atherosclerosis, are highly susceptible to hydrolysis and aggregation by S-SMase at pH 7.4; a high SM:PC ratio in these lipoproteins appears to be an important factor in their susceptibility to S-SMase. Most importantly, LDL extracted from human atherosclerotic lesions, which is enriched in sphingomyelin compared with plasma LDL, is hydrolyzed by S-SMase at pH 7.4 10-fold more than same donor plasma LDL, suggesting that LDL is modified in the arterial wall to increase its susceptibility to S-SMase. In summary, atherogenic lipoproteins are excellent substrates for S-SMase, even at neutral pH, making this enzyme a leading candidate for the arterial wall SMase that hydrolyzes LDL-SM and causes subendothelial LDL aggregation.