Embryo dormancy in flowering plants is an important dispersal mechanism that promotes survival of the seed through time. The subsequent transition to germination is a critical control point regulating initiation of vegetative growth. Here we show that the Arabidopsis COMATOSE (CTS) locus is required for this transition, and acts, at least in part, by profoundly affecting the metabolism of stored lipids. CTS encodes a peroxisomal protein of the ATP binding cassette (ABC) transporter class with significant identity to the human X-linked adrenoleukodystrophy protein (ALDP). Like X-ALD patients, cts mutant embryos and seedlings exhibit pleiotropic phenotypes associated with perturbation in fatty acid metabolism. CTS expression transiently increases shortly after imbibition during germination, but not in imbibed dormant seeds, and genetic analyses show that CTS is negatively regulated by loci that promote embryo dormancy through multiple independent pathways. Our results demonstrate that CTS regulates transport of acyl CoAs into the peroxisome, and indicate that regulation of CTS function is a major control point for the switch between the opposing developmental programmes of dormancy and germination.