Partitioning of fatty acids between membrane and storage lipids controls ER membrane expansion

Biogenesis of membrane-bound organelles involves the synthesis, remodeling, and degradation of their constituent phospholipids. How these pathways regulate organelle size remains poorly understood. Here we demonstrate that a lipid-degradation pathway inhibits expansion of the endoplasmic reticulum (ER) membrane. Phospholipid diacylglycerol acyltransferases (PDATs) use endogenous phospholipids as fatty-acyl donors to generate triglyceride stored in lipid droplets. The significance of this non-canonical triglyceride biosynthesis pathway has remained elusive. We find that the activity of the yeast PDAT Lro1 is regulated by a membrane-proximal helical segment facing the luminal side of the ER bilayer. To reveal the biological roles of PDATs, we engineered an Lro1 variant with derepressed activity. We show that active Lro1 mediates retraction of ER membrane expansion driven by phospholipid synthesis. Furthermore, subcellular distribution and membrane turnover activity of Lro1 are controlled by diacylglycerol produced by the activity of Pah1, a conserved member of the lipin family. Collectively, our findings reveal a lipid-metabolic network that regulates endoplasmic reticulum biogenesis by converting phospholipids into storage lipids.