Ubiquitous in eukaryotes, inositol lipids have finely tuned roles in cellular signaling and membrane homeostasis. In Bacteria, however, inositol lipid production is rare. Recently, the prominent human gut bacterium Bacteroides thetaiotaomicron (BT) was reported to produce inositol lipids, including inositol sphingolipids, but the pathways remain ambiguous and their prevalence unclear. Here, we investigated the gene cluster responsible for inositol lipid synthesis in BT using a novel strain with inducible control of sphingolipid synthesis. We characterized the biosynthetic pathway from myo-inositol-phosphate (MIP) synthesis to phosphoinositol-dihydroceramide, including structural and kinetic studies of the enzyme MIP synthase (MIPS). We determined the crystal structure of recombinant BT MIPS with bound NAD cofactor at 2.0 Å resolution, and identified the first reported phosphatase for the conversion of bacterially-derived phosphatidylinositol phosphate (PIP) to phosphatidylinositol (PI). Transcriptomic analysis indicated inositol production is nonessential but its loss alters BT capsule expression. Bioinformatic and lipidomic comparisons of Bacteroidetes species revealed a novel second putative pathway for bacterial PI synthesis without a PIP intermediate. Our results indicate that inositol sphingolipid production, via one of the two pathways, is widespread in host-associated Bacteroidetes, and may be implicated in host interactions both indirectly via the capsule and directly through inositol lipid provisioning.