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Lipid droplets (LDs) are organelles that store and supply lipids based on cellular needs. While mechanisms preventing oxidative damage to membrane phospholipids are established, the vulnerability of LD neutral lipids to peroxidation and protective mechanisms are unknown. Here, we identify LD-localized Ferroptosis Suppressor Protein 1 (FSP1) as a critical regulator that prevents neutral lipid peroxidation by recycling coenzyme Q10 (CoQ10) to its lipophilic antioxidant form. Lipidomics reveal that FSP1 loss leads to the accumulation of oxidized triacylglycerols and cholesteryl esters, and biochemical reconstitution of FSP1 with CoQ10 and NADH suppresses triacylglycerol peroxidation in vitro . Notably, polyunsaturated fatty acid (PUFA)-rich triacylglycerols enhance cancer cell sensitivity to FSP1 loss and inducing PUFA-rich LDs triggers triacylglycerol peroxidation and LD-initiated ferroptosis when FSP1 activity is impaired. These findings uncover the first LD lipid quality control pathway, wherein LD-localized FSP1 maintains neutral lipid integrity to prevent the buildup of oxidized lipids and induction of ferroptosis., Competing Interests: COMPETING INTERESTS J.A.O. is a member of the scientific advisory board for Vicinitas Therapeutics and has patent applications related to ferroptosis.