The lipid layer is an essential component of the tear film, providing a smooth optical surface for the cornea and retarding evaporation from the eye. The meibomian lipids which compose it are well adapted for this purpose. They form a thin, smooth film whose thickness, and probably composition, influences the rate of evaporation. Their melting range ensures sufficient fluidity for delivery to the tear film from the lid margin reservoirs, while the film itself may exhibit a higher viscosity at the cooler temperature of the ocular surface. The factors governing lipid film formation during the blink are not fully understood, but one view is that the polar lipids, interacting with the aqueous sub-phase of the tear film, spread in advance of the non-polar components, which form the bulk of the film. The meibomian lipids stabilise the tear film by lowering its free energy; they carry water into the film during its formation and interact with lipid-binding proteins in the aqueous phase, such as tear lipocalin. The lipocalins, complexed with other tear components, may also contribute to the high, non-Newtonian viscosity of the tear film and its low surface tension, features which are essential for tear film stability. Formation of the lipid film is a complex process. Lipid is delivered to the tear film in the up-phase of the blink, more from the lower than the upper reservoir. The lipid layer comes to a stop well after completion of the blink and remains relatively immobile until it is compressed in the down-phase of the blink that follows. Then, it either retains its structure in a series of subsequent blinks, or is completely re-constituted after mixing with the reservoir lipids. Delivery of meibomian lipid to the marginal reservoirs is mainly the result of continuous secretion, under neural and hormonal control, supplemented by lid action. The reservoirs provide a hydrophobic barrier to tear overspill and to contamination by skin lipids which might destabilise the tear film. They probably also provide the chief route for meibomian lipid excretion.