Mutations in the gene encoding comparative gene identifi cation-58 [CGI-58; also ␣ /  hydrolase domain 5 (ABHD5)] cause Chanarin-Dorfman syndrome (CDS) ( 1 ), a neutral lipid storage disorder characterized by excessive accumulation of triacylglycerols (TAGs) in cells and tissues, including liver, skeletal muscle, intestinal epithelia, leukocytes, keratinocytes, and skin fi broblasts, leading to hepatomegaly, ichthyosis, and mild muscle weakness ( 2-7 ). These early observations suggested that CGI-58 plays an important role in TAG homeostasis in multiple tissues. Although CGI-58 is a member of the lipase subfamily of ␣ /  hydrolase domain proteins, it lacks a serine residue in a conserved sequence (GXSXG) that normally harbors the nucleophilic component of the catalytic triad ( 1 ). Identifi cation of CGI-58 as a coactivator of the widely expressed adipose TG lipase (ATGL) ( 8 ) provided a mechanistic explanation for the phenotype of CDS patients; loss of functional CGI-58 reduces ATGL-mediated hydrolysis of TAGs, in turn increasing TAG storage in tissues. Individuals with mutations in ATGL show similarities to CDS patients with TAG accumulation in various tissues including liver and skeletal muscle ( 9 ); however, these individuals lack ichthyosis and have more severe skeletal muscle myopathy than individuals with CDS, as well as cardiomyopathy. The phenotypic differences between individuals with mutations in CGI-58 and those with mutations in ATGL suggest that CGI-58 serves one or more functions distinct from coactivation of ATGL.Abstract Mutations in the gene encoding comparative gene identifi cation 58 (CGI-58)/ ␣ /  hydrolase domain 5 (ABHD5) cause Chanarin-Dorfman syndrome, characterized by excessive triacylglycerol storage in cells and tissues. CGI-58 has been identifi ed as a coactivator of adipose TG lipase (ATGL) and a lysophosphatidic acid acyltransferase (LPAAT). We developed a molecular model of CGI-58 structure and then mutated predicted active site residues and performed LPAAT activity assays of recombinant WT and mutated CGI-58. When mutations of predicted catalytic residues failed to reduce LPAAT activity, we determined that LPAAT activity was due to a bacterial contaminant of affi nity purifi cation procedures, plsC, the sole LPAAT in Escherichia coli . Purifi cation protocols were optimized to reduce plsC contamination, in turn reducing LPAAT activity. When CGI-58 was expressed in SM2-1(DE3) cells that lack plsC, lysates lacked LPAAT activity. Additionally, mouse CGI-58 expressed in bacteria as a glutathione-S -transferase fusion protein and human CGI-58 expressed in yeast lacked LPAAT activity. Previously reported lipid binding activity of CGI-58 was revisited using protein-lipid overlays. Recombinant CGI-58 failed to bind lysophosphatidic acid, but interestingly, bound phosphatidylinositol 3-phosphate [PI (3)