To ensure fertility, it is paramount to understand the factors controlling oocyte quality. One incompletely characterized factor contributing to oocyte quality is lipids. In somatic cells, a key regulator of lipid metabolism is lipid droplets (LDs), the sites of intracellular fat storage. Yet the role of LDs in fertility is poorly understood. Here we use Drosophila oogenesis as a model for uncovering if and how LDs promote egg development. LD accumulation in nurse cells coincides with dynamic actin remodeling necessary for late-stage follicle morphogenesis and fertility. Loss of major LD proteins, including PLIN2, Jabba, and ATGL, disrupts both actin bundle formation and cortical actin integrity; this unusual phenotype is also seen when Pxt, the enzyme responsible for prostaglandin (PG) synthesis, is missing. Further, both pharmacologic and genetic loss of PG synthesis or loss of PLIN2 or Jabba impairs intracellular LD dispersal. These similar phenotypes suggest that PGs and LD proteins act in the same pathway. Dominant genetic interaction studies indicate that there are three actin regulatory pathways: PLIN2 regulates actin remodeling independent of PG signaling, whereas Jabba and ATGL act in two separate PG-dependent pathways to regulate actin remodeling. We find that neither Jabba nor ATGL modulate the levels of Pxt or its localization to the endoplasmic reticulum. As ATGL is a triglyceride lipase, we hypothesize that it may release arachidonic acid (AA), the substrate for PG production, from triglycerides stored in LDs. Indeed, lipidomic analysis reveals the presence of AA-containing triglycerides in ovaries. In addition, exogenous AA is toxic and reduction of ATGL ameliorates toxicity; these observations suggest that ATGL indeed generates free AA. Our studies provide the first evidence that LDs and their associated proteins regulate PG signaling to control actin remodeling. In particular, we propose that ATGL releases AA from LDs to drive PG synthesis necessary for follicle development. We speculate that the same pathways are conserved across organisms to regulate oocyte development and promote fertility.