Lipid metabolism in Trypanosoma brucei, the causative agent of African sleeping sickness, differs from its human host in several fundamental ways. This has lead to the validation of a plethora of novel drug targets, giving hope of novel chemical intervention against this neglected disease. Cytidine diphosphate diacylglycerol (CDP-DAG) is a central lipid intermediate for several pathways in both prokaryotes and eukaryotes, being produced by CDP-DAG synthase (CDS). However, nothing is known about the single T. brucei CDS gene (Tb927.7.220/EC 188.8.131.52) or its activity. In this study we show TbCDS is functional by complementation of a non-viable yeast CDS null strain and that it is essential in the bloodstream form of the parasite via a conditional knockout. The TbCDS conditional knockout showed morphological changes including a cell-cycle arrest due in part to kinetoplast segregation defects. Biochemical phenotyping of TbCDS conditional knockout showed drastically altered lipid metabolism where reducing levels of phosphatidylinositol detrimentally impacted on glycoylphosphatidylinositol biosynthesis. These studies also suggest that phosphatidylglycerol synthesized via the phosphatidylglycerol-phosphate synthase is not synthesized from CDP-DAG, as was previously thought. TbCDS was shown to localized the ER and Golgi, probably to provide CDP-DAG for the phosphatidylinositol synthases.