Dihydroceramide desaturases convert dihydroceramides to ceramides in the last step of thede novoceramide pathway. Reduction of DEGS1 dihydroceramide desaturase function in humans leads to the rare neurodegenerative disorder hypomyelinating leukodystrophy-18, but the exact mechanism that underlies the disease remains unclear. Through a forward genetic screen, we discovered thatinfertile crescent (ifc), the soleDrosophiladihydroceramide desaturase, governs central nervous system development and morphology. Expressed and genetically active most prominently in glia rather than neurons,ifcprimarily controls nervous system development through a cell autonomous function in glia. Within the nervous system, loss ofifcresults in ceramide depletion, dihydroceramide accumulation, and increased saturation of major membrane phospholipids. At the cellular level, loss ofifcleads to severe glial defects, particularly in cortex glia, including expansion of the endoplasmic reticulum, cell swelling, failure to enwrap neurons, and lipid droplet depletion. Our research supports a model in which inappropriate retention of dihydroceramide in the endoplasmic reticulum (ER) of glial cells drives ER expansion and cell swelling, disrupting glial function and leading to subsequent nervous system dysfunction. Given the conserved nature of thede novoceramide biosynthesis pathway, our findings in the fly system suggest that dihydroceramide-triggered expansion of the ER in the membrane-rich glial cells may be the proximal cause of hypomyelinating leukodystrophy-18 in humans.