Adult human cardiomyocytes have an extremely limited proliferative capacity, which poses a great barrier to regenerative medicine and research. Human embryonic stem cells (hESCs) have been proposed as an alternative source to generate large numbers of clinical grade cardiomyocytes (CMs) that can have potential therapeutic applications to treat cardiac diseases. Previous studies have shown that bioactive lipids are involved in diverse cellular responses including cardiogenesis. In this study, we explored the novel function of the chemically synthesized bioactive lipid O-cyclic phytosphingosine-1-phosphate (cP1P) as an inducer of cardiac differentiation. Here, we identified cP1P as a novel factor that significantly enhances the differentiation potential of hESCs into cardiomyocytes. Treatment with cP1P augments the beating colony number and contracting area of CMs. Furthermore, we elucidated the molecular mechanism of cP1P regulating SMAD1/5/8 signaling via the ALK3/BMP receptor cascade during cardiac differentiation. Our result provides a new insight for cP1P usage to improve the quality of CM differentiation for regenerative therapies.