Lipid droplets (LDs) are ubiquitous organelles that store neutral lipids for energy or membrane synthesis and act as hubs for metabolic processes. Cells generate LDs de novo, converting cells to emulsions with LDs constituting the dispersed oil phase in the aqueous cytoplasm. Here we review our current view of LD biogenesis. We present a model of LD formation from the ER in distinct steps and highlight the biology of proteins that govern this biophysical process. Areas of incomplete knowledge are identified, as are connections with physiology and diseases linked to alterations in LD biology.