Mitochondria derive the majority of their lipids from other organelles through contact sites. These lipids, primarily phosphoglycerolipids, are the main components of mitochondrial membranes. In the cell, neutral lipids like triacylglycerides (TAGs) are stored in lipid droplets, playing an important role in maintaining cellular health. Enzymes like lipases mobilize these TAGs according to cellular needs. Neutral lipids have not yet been reported to play an important role in mitochondria so the presence of a putative TAG lipase-Tgl2, in yeast mitochondria is surprising. Moreover, TGL2 and MCP2, a high-copy suppressor for ER mitochondria encounter structure deficient cells, display genetic interactions suggesting a potential link of both proteins to lipid metabolism. In this study, we characterize in detail Tgl2. We show that Tgl2 forms dimers through intermolecular disulfide bridges and a cysteine-dependent high molecular weight complex. Furthermore, we could identify the lipase motif and catalytic triad of Tgl2 through in silico comparison with other lipases. Mutating each of the three catalytically active residues resulted in variants that failed to rescue the growth phenotype of mcp2Δ tgl2Δ double deletion strain supporting the assumption that these residues are indeed essential for the protein's function. Additionally, we discovered that the catalytically active aspartate residue (D259) is important for protein stability. Steady state level analyses with unstable variants of Tgl2 led to the identification of Yme1 as the protease responsible for its quality control. Finally, we provide evidence that the overall increase in TAGs in cells lacking Mcp2 and Tgl2 originates from the mitochondria. Collectively, our study provides new insights into a key player in mitochondrial lipid homeostasis.