The selective breakdown by autophagy of lipid droplet (LD)-stored lipids, termed lipophagy, is a lysosomal lipolytic pathway that complements the actions of cytosolic neutral lipases. The physiological importance of lipophagy has been demonstrated in multiple mammalian cell types, as well as in lower organisms, and this pathway has many functions in addition to supplying free fatty acids to maintain cellular energy stores. Recent studies have begun to delineate the molecular mechanisms of the selective recognition of LDs by the autophagic machinery, as well as the intricate crosstalk between the different forms of autophagy and neutral lipases. These studies have led to increased interest in the role of lipophagy in both human disease pathogenesis and therapy.