Lipid droplets are essential cellular organelles for storage of fatty acids and triglycerides. The hepatitis C virus (HCV) translocates several of its proteins onto their surface and uses them for production of infectious progeny. We recently reported that the lipid droplet-associated α/β hydrolase domain-containing protein 5 (ABHD5/CGI-58) participates in HCV assembly by mobilizing lipid droplet-associated lipids. However, ABHD5 itself has no lipase activity and it remained unclear how ABHD5 mediates lipolysis critical for HCV assembly. Here, we identify adipose triglyceride lipase (ATGL) as ABHD5 effector and new host factor involved in the hepatic lipid droplet degradation as well as in HCV and lipoprotein morphogenesis. Modulation of ATGL protein expression and lipase activity controlled lipid droplet lipolysis and virus production. ABHD4 is a paralog of ABHD5 unable to activate ATGL or support HCV assembly and lipid droplet lipolysis. Grafting ABHD5 residues critical for activation of ATGL onto ABHD4 restored the interaction between lipase and co-lipase and bestowed the pro-viral and lipolytic functions onto the engineered protein. Congruently, mutation of the predicted ABHD5 protein interface to ATGL ablated ABHD5 functions in lipid droplet lipolysis and HCV assembly. Interestingly, minor alleles of ABHD5 and ATGL associated with neutral lipid storage diseases in human, are also impaired in lipid droplet lipolysis and their pro-viral functions. Collectively, these results show that ABHD5 cooperates with ATGL to mobilize triglycerides for HCV infectious virus production. Moreover, viral manipulation of lipid droplet homeostasis via the ABHD5-ATGL axis, akin to natural genetic variation in these proteins, emerges as a possible mechanism by which chronic HCV infection causes liver steatosis
