Mitochondria are dynamic organelles whose function depends on intramitochondrial phospholipid synthesis and the supply of membrane lipids from the endoplasmic reticulum. How phospholipids are transported to and in-between mitochondrial membranes remained unclear. We identified Ups1, a yeast member of a conserved family of intermembrane space proteins, as a lipid transfer protein that can shuttle phosphatidic acid between mitochondrial membranes. Lipid transfer required the dynamic assembly of Ups1 with Mdm35 and allowed conversion of phosphatidic acid to cardiolipin in the inner membrane. High cardiolipin concentrations prevented membrane dissociation of Ups1, leading to its proteolysis and inhibiting transport of phosphatidic acid and cardiolipin synthesis. Thus, intramitochondrial lipid trafficking may involve a regulatory feedback mechanism that limits the accumulation of cardiolipin in mitochondria.