Mutations in Frataxin (FXN) cause Friedreich's ataxia (FRDA), a recessive neurodegenerative disorder. Previous studies have proposed that loss of FXN causes mitochondrial dysfunction, which triggers elevated reactive oxygen species (ROS) and leads to the demise of neurons. Here we describe a ROS independent mechanism that contributes to neurodegeneration in fly FXN mutants. We show that loss of frataxin homolog (fh) in Drosophila leads to iron toxicity, which in turn induces sphingolipid synthesis and ectopically activates 3-phosphoinositide dependent protein kinase-1 (Pdk1) and myocyte enhancer factor-2 (Mef2). Dampening iron toxicity, inhibiting sphingolipid synthesis by Myriocin, or reducing Pdk1 or Mef2 levels, all effectively suppress neurodegeneration in fh mutants. Moreover, increasing dihydrosphingosine activates Mef2 activity through PDK1 in mammalian neuronal cell line suggesting that the mechanisms are evolutionarily conserved. Our results indicate that an iron/sphingolipid/Pdk1/Mef2 pathway may play a role in FRDA.