Regulation of membrane lipid composition is crucial for many aspects of cell growth and development. Lipins, a novel family of phosphatidate (PA) phosphatases that generate diacylglycerol (DAG) from PA, are emerging as essential regulators of fat metabolism, adipogenesis, and organelle biogenesis. The mechanisms that govern lipin translocation onto membranes are largely unknown. Here we show that recruitment of the yeast lipin (Pah1p) is regulated by PA levels onto the nuclear/endoplasmic reticulum (ER) membrane. Recruitment requires the transmembrane protein phosphatase complex Nem1p-Spo7p. Once dephosphorylated, Pah1p can bind to the nuclear/ER membrane independently of Nem1p-Spo7p via a short amino-terminal amphipathic helix. Dephosphorylation enhances the activity of Pah1p, both in vitro and in vivo, but only in the presence of a functional helix. The helix is required for both phospholipid and triacylglycerol biosynthesis. Our data suggest that dephosphorylation of Pah1p by the Nem1p-Spo7p complex enables the amphipathic helix to anchor Pah1p onto the nuclear/ER membrane allowing the production of DAG for lipid biosynthesis.