Dietary restriction increases the longevity of many organisms, but the cell signaling and organellar mechanisms underlying this capability are unclear. We demonstrate that to permit long-term survival in response to sudden glucose depletion, yeast cells activate lipid-droplet (LD) consumption through micro-lipophagy (µ-lipophagy), in which fat is metabolized as an alternative energy source. AMP-activated protein kinase (AMPK) activation triggered this pathway, which required Atg14p. More gradual glucose starvation, amino acid deprivation or rapamycin did not trigger µ-lipophagy and failed to provide the needed substitute energy source for long-term survival. During acute glucose restriction, activated AMPK was stabilized from degradation and interacted with Atg14p. This prompted Atg14p redistribution from ER exit sites onto liquid-ordered vacuole membrane domains, initiating µ-lipophagy. Our findings that activated AMPK and Atg14p are required to orchestrate µ-lipophagy for energy production in starved cells is relevant for studies on aging and evolutionary survival strategies of different organisms.