Maintaining cellular lipid homeostasis is crucial to oxidative tissues, and it becomes compromised in obesity. Lipid droplets (LD) play a central role in lipid homeostasis by mediating fatty acid (FA) storage in the form of triglyceride, thereby lowering intracellular levels of lipids that mediate cellular lipotoxicity. LDs and mitochondria have interconnected functions, and anecdotal evidence suggests they physically interact. However, the mechanisms of interaction have not been identified. Perilipins are LD-scaffolding proteins and potential candidates to play a role in their interaction with mitochondria. We examined the contribution of LD perilipin composition to the physical and metabolic interactions between LD and mitochondria using multiple techniques: confocal imaging, electron microscopy (EM), and lipid storage and utilization measurements. Using neonatal cardiomyocytes, reconstituted cell culture models, and rodent heart tissues, we found that perilipin 5 (Plin5) recruits mitochondria to the LD surface through a C-terminal region. Compared with control cells, Plin5-expressing cells show decreased LD hydrolysis, decreased palmitate β-oxidation, and increased palmitate incorporation into triglycerides in basal conditions, whereas in stimulated conditions, LD hydrolysis inhibition is lifted and FA released for β-oxidation. These results suggest that Plin5 regulates oxidative LD hydrolysis and controls local FA flux to protect mitochondria against excessive exposure to FA during physiological stress.