Lignocellulose-derived sugars and other biorefinery by-product streams such as glycerol and acetic acid are useful carbon feedstocks for microbes that produce lipids. Lipids have high energy density and are easily converted into versatile biofuels and valuable oleochemicals. Common, robust yeasts such as Saccharomyces cerevisiae and Yarrowia lipolytica have been the most successfully exploited as cell factories for lipid production, and excellent progress has been made in productivity with the implementation of synthetic biology tools and metabolic engineering strategies. Accumulation and storage of standard fatty acids as triacylglycerols or secretion of free fatty acids has been enhanced by modification of metabolic pathways yielding maximal fatty acid titers above 100 g L−1 and productivity of 0.8 g L−1 h−1. Production of higher-value exotic fatty acids that are not native to yeast, such as short chain, hydroxylated, and cyclopropane, has great potential but requires more research into lipid synthesis pathways and new metabolic engineering strategies to achieve similar productivities as achieved for standard fatty acids. In addition, monitoring of cell viability and health, balancing cofactor demands, and minimizing stress are important strategies to avoid or reduce metabolic burden caused by engineering of cells.