Triacylglycerol (TAG) is the major storage component for fatty acids, and thus for energy, in eukaryotic cells. In this mini-review, we describe recent progress that has been made with the yeast Saccharomyces cerevisiae in understanding formation of TAG and its cell biological role. Formation of TAG involves the synthesis of phosphatidic acid (PA) and diacylglycerol (DAG), two key intermediates of lipid metabolism. De novo formation of PA in yeast as in other types of cells can occur either through the glycerol-3-phosphate- or dihydroxyacetone phosphate-pathways-each named after its respective precursor. PA, formed in two steps of acylation, is converted to DAG by phosphatidate phosphatase. Acylation of DAG to yield TAG is catalyzed mainly by the two yeast proteins Dga1p and Lro1p, which utilize acyl-CoA or phosphatidylcholine, respectively, as acyl donors. In addition, minor alternative routes of DAG acylation appear to exist. Endoplasmic reticulum and lipid particles (LP), the TAG storage compartment in yeast, are the major sites of TAG synthesis. The interplay of these organelles, formation of LP, and enzymatic properties of enzymes catalyzing the synthesis of PA, DAG, and TAG in yeast are discussed in this communication.