Sphingolipids are sphingosine-based phospholipids, which are present in the plasma and endomembranes of many eukaryotic cells. These lipids are involved in various cellular functions, including cell growth, differentiation, and apoptosis. In addition, sphingolipid and cholesterol-enriched membrane microdomains (also called “lipid rafts”) contain a set of proteins and lipids, which take part in the signaling process in response to intra- or extracellular stimuli. Recent findings suggest that sphingolipids, especially glucosylceramide, play a critical role in inducing encystation and maintaining the cyst viability in Giardia. Similarly, the assembly/disassembly of lipid rafts modulates the encystation and cyst production of this ubiquitous enteric parasite. In this review article, we discuss the overall progress in the field and examine whether sphingolipids and lipid rafts can be used as novel targets for designing therapies to control infection by Giardia, which is rampant in developing countries, where children are especially vulnerable.