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The endoplasmic reticulum (ER) regulates cellular protein and lipid biosynthesis. ER dysfunction leads to protein misfolding and the unfolded protein response (UPR), which limits protein synthesis to prevent cytotoxicity. Chronic ER stress in skeletal muscle is a unifying mechanism linking lipotoxicity to metabolic disease. Unidentified signals from cells undergoing ER stress propagate paracrine and systemic UPR activation. Here, we induce ER stress and lipotoxicity in myotubes. We observe ER stress-inducing lipid cell non-autonomous signal(s). Lipidomics identifies that palmitate-induced cell stress induces long-chain ceramide 40:1 and 42:1 secretion. Ceramide synthesis through the ceramide synthase 2 de novo pathway is regulated by UPR kinase Perk. Inactivation of CerS2 in mice reduces systemic and muscle ceramide signals and muscle UPR activation. The ceramides are packaged into extracellular vesicles, secreted and induce UPR activation in naïve myotubes through dihydroceramide accumulation. This study furthers our understanding of ER stress by identifying UPR-inducing cell non-autonomous signals.