Mammalian lipid droplets (LDs) are specialized cytosolic organelles consisting of a neutral lipid core surrounded by a membrane made up of a phospholipid monolayer and a specific population of proteins that varies according to the location and function of each LD. Over the past decade, there have been significant advances in the understanding of LD biogenesis and functions. LDs are now recognized as dynamic organelles that participate in many aspects of cellular homeostasis plus other vital functions. LD biogenesis is a complex, highly-regulated process with assembly occurring on the endoplasmic reticulum although aspects of the underpinning molecular mechanisms remain elusive. For example, it is unclear how many enzymes participate in the biosynthesis of the neutral lipid components of LDs and how this process is coordinated in response to different metabolic cues to promote or suppress LD formation and turnover. In addition to enzymes involved in the biosynthesis of neutral lipids, various scaffolding proteins play roles in coordinating LD formation. Despite their lack of ultrastructural diversity, LDs in different mammalian cell types are involved in a wide range of biological functions. These include roles in membrane homeostasis, regulation of hypoxia, neoplastic inflammatory responses, cellular oxidative status, lipid peroxidation, and protection against potentially toxic intracellular fatty acids and lipophilic xenobiotics. Herein, the roles of mammalian LDs and their associated proteins are reviewed with a particular focus on their roles in pathological, immunological and anti-toxicological processes.