The incorporation of excess saturated free fatty acids (SFAs) into membrane phospholipids within the ER promotes ER stress, insulin resistance, and hepatic gluconeogenesis. Thioesterase superfamily member 2 (Them2) is a mitochondria-associated long-chain fatty acyl-CoA thioesterase that is activated upon binding phosphatidylcholine transfer protein (PC-TP). Under fasting conditions, the Them2/PC-TP complex directs saturated fatty acyl-CoA toward β-oxidation. Here, we showed that during either chronic overnutrition or acute induction of ER stress, Them2 and PC-TP play critical roles in trafficking SFAs into the glycerolipid biosynthetic pathway to form saturated phospholipids, which ultimately reduce ER membrane fluidity. The Them2/PC-TP complex activated ER stress pathways by enhancing translocon-mediated efflux of ER calcium. The increased cytosolic calcium, in turn, led to the phosphorylation of calcium/calmodulin-dependent protein kinase II, which promoted both hepatic insulin resistance and gluconeogenesis. These findings delineate a mechanistic link between obesity and insulin resistance and establish the Them2/PC-TP complex as an attractive target for the management of hepatic steatosis and insulin resistance.