Fatty acids (FAs) are essential for cell survival, yet their overaccumulation causes lipotoxicity. To prevent lipotoxicity, cells store excess FAs as triglycerides (TGs). In cultured cells TG synthesis is activated by excess unsaturated but not saturated FAs. Here, we identify Ubxd8 as a sensor for unsaturated FAs and regulator of TG synthesis. In cultured cells depleted of FAs, Ubxd8 inhibits TG synthesis by blocking conversion of diacylglycerols (DAGs) to TGs. Excess unsaturated but not saturated FAs relieve this inhibition. As a result, unsaturated FAs are incorporated into TGs, whereas saturated FAs are incorporated into DAGs. In vitro, unsaturated but not saturated FAs alter the structure of purified recombinant Ubxd8 as monitored by changes in its thermal stability, trypsin cleavage pattern, and oligomerization. These results suggest that Ubxd8 acts as a brake that limits TG synthesis, and this brake is released when its structure is altered by exposure to unsaturated FAs.