Osteosarcoma is a primary malignant tumor that commonly affects children and adolescents, with a poor prognosis. The existence of tumor heterogeneity leads to different molecular subtypes and survival outcomes. Recently, lipid metabolism has been identified as a critical characteristic of cancer. Therefore, our study aims to identify osteosarcoma's lipid metabolism molecular subtype and develop a signature for survival outcome prediction. Four multicenter cohorts—TARGET-OS, GSE21257, GSE39058, and GSE16091—were amalgamated into a unified Meta-Cohort. Through consensus clustering, novel molecular subtypes within Meta-Cohort patients were delineated. Subsequent feature selection processes, encompassing analyses of differentially expressed genes between subtypes, univariate Cox analysis, and StepAIC, were employed to pinpoint biomarkers related to lipid metabolism in TARGET-OS. We selected the most effective algorithm for constructing a Lipid Metabolism-Related Signature (LMRS) by utilizing four machine-learning algorithms reconfigured into ten unique combinations. This selection was based on achieving the highest concordance index (C-index) in the test cohort of GSE21257, GSE39058, and GSE16091. We identified two distinct lipid metabolism molecular subtypes in osteosarcoma patients, C1 and C2, with significantly different survival rates. C1 is characterized by increased cholesterol, fatty acid synthesis, and ketone metabolism. In contrast, C2 focuses on steroid hormone biosynthesis, arachidonic acid, and glycerolipid and linoleic acid metabolism. Feature selection in the TARGET-OS identified 12 lipid metabolism genes, leading to a model predicting osteosarcoma patient survival. The LMRS, based on the 12 identified genes, consistently accurately predicted prognosis across TARGET-OS, testing cohorts, and Meta-Cohort. Incorporating 12 published signatures, LMRS showed robust and significantly superior predictive capability. Our results offer a promising tool to enhance the clinical management of osteosarcoma, potentially leading to improved clinical outcomes.