Although the role of the Hippo signaling pathway in development and tumorigenesis has been extensively studied in multiple organs, its role in ovarian follicle development remains largely unknown. Here, we report that Yes‐Associated Protein 1 (YAP1), the major effector of Hippo signaling, is spatiotemporally expressed in ovarian granulosa cells and plays a critical role in the regulation of follicle development. We found that the active form of YAP1 (nuclear YAP1) was predominantly expressed in proliferative granulosa cells, whereas the inactive form of YAP1 (cytoplasmic YAP1) was mainly detected in luteal cells (terminally differentiated granulosa cells). Pharmacological inhibition of YAP1 activity disrupted mouse ovarian follicle development in vitro and in vivo. Foxl2 promoter–driven knockout of Yap1 in ovarian granulosa cells resulted in increased apoptosis of granulosa cells, decreased number of corpora lutea, reduced ovarian size, and subfertility in transgenic mice. However, Cyp19a1 promoter–driven knockout of Yap1 in differentiated granulosa cells of preovulatory follicles and luteal cells of corpora lutea had no effect on ovarian morphology and fertility. Mechanistic studies demonstrated that YAP1 interacted with epidermal growth factor receptor and TGF‐β signaling pathways to regulate granulosa cell proliferation, differentiation, and survival. Results from this study identify YAP1 as a critical regulator of granulosa cell proliferation and differentiation. Balanced expression and activation of YAP1 is essential for follicle development and successful reproduction. YAP1 is a promising target for treatment of subfertility associated with abnormal granulosa cell function.—Lv, X., He, C., Huang, C., Wang, H., Hua, G., Wang, Z., Zhou, J., Chen, X., Ma, B., Timm, B. K., Maclin, V., Dong, J., Rueda, B. R., Davis, J. S., Wang, C. Timely expression and activation of YAP1 in granulosa cells is essential for ovarian follicle development. FASEB J. 33, 10049–10064 (2019). http://www.fasebj.org