Lipins are evolutionarily conserved proteins found from yeasts to humans. Mammalian and yeast lipin proteins have been shown to control gene expression and to enzymatically convert phosphatidate to diacylglycerol, an essential precursor in triacylglcerol (TAG) and phospholipid synthesis. Loss of lipin 1 in the mouse, but not in humans, leads to lipodystrophy and fatty liver disease. Here we show that the single lipin orthologue of Drosophila melanogaster (dLipin) is essential for normal adipose tissue (fat body) development and TAG storage. dLipin mutants are characterized by reductions in larval fat body mass, whole-animal TAG content, and lipid droplet size. Individual cells of the underdeveloped fat body are characterized by increased size and ultrastructural defects affecting cell nuclei, mitochondria, and autophagosomes. Under starvation conditions, dLipin is transcriptionally upregulated and functions to promote survival. Together, these data show that dLipin is a central player in lipid and energy metabolism, and they establish Drosophila as a genetic model for further studies of conserved functions of the lipin family of metabolic regulators.