The bioactive lipid molecule sphingosine 1-phosphate (S1P) binds to specific cell surface receptors and regulates several cellular processes. S1P is abundant in plasma, and physiologically its most important target cells are lymphocytes and vascular endothelial cells. S1P plays a pivotal role in the immune system by regulating lymphocyte egress from the thymus and secondary lymphoid organs. The immunomodulator FTY720 impairs this egress, causing lymphopenia. Platelets had long been considered to be the major source of plasma S1P, however recent studies revealed the importance of erythrocytes as a major supply. The sphingosine analog FTY720 is a prodrug, and FTY720 phosphate (FTY720-P) its functional form. Although both erythrocytes and platelets can produce S1P, only platelets synthesize and release FTY720-P. This review will focus on the recent advances in our understanding of the metabolism and release of S1P and FTY720-P, especially in platelets and erythrocytes.