Acetic acid-induced inhibition of yeast growth and metabolism limits the productivity of industrial fermentation processes, especially when lignocellulosic hydrolysates are used as feedstock in industrial biotechnology. Tolerance to acetic acid of food spoilage yeasts is also a problem in the preservation of acidic foods and beverages. Thus understanding the molecular mechanisms underlying adaptation and tolerance to acetic acid stress is increasingly important in industrial biotechnology and the food industry. Prior genetic screens for Saccharomyces cerevisiae mutants with increased sensitivity to acetic acid identified loss-of-function mutations in the YPK1 gene, which encodes a protein kinase activated by the target of rapamycin (TOR) complex 2 (TORC2). We show in the present study by several independent criteria that TORC2-Ypk1 signaling is stimulated in response to acetic acid stress. Moreover, we demonstrate that TORC2-mediated Ypk1 phosphorylation and activation is necessary for acetic acid tolerance, and occurs independently of Hrk1, a protein kinase previously implicated in the cellular response to acetic acid. In addition, we show that TORC2-Ypk1-mediated activation of l-serine:palmitoyl-CoA acyltransferase, the enzyme complex that catalyzes the first committed step of sphingolipid biosynthesis, is required for acetic acid tolerance. Furthermore, analysis of the sphingolipid pathway using inhibitors and mutants indicates that it is production of certain complex sphingolipids that contributes to conferring acetic acid tolerance. Consistent with that conclusion, promoting sphingolipid synthesis by adding exogenous long-chain base precursor phytosphingosine to the growth medium enhanced acetic acid tolerance. Thus appropriate modulation of the TORC2-Ypk1-sphingolipid axis in industrial yeast strains may have utility in improving fermentations of acetic acid-containing feedstocks.