The endoplasmic reticulum (ER) consists of the nuclear envelope and a connected peripheral network of tubules and interspersed sheets. The structure of ER tubules is generated and maintained by various proteins, including reticulons, DP1/Yop1p, atlastins, and lunapark. Reticulons and DP1/Yop1p stabilize the high membrane curvature of ER tubules, and atlastins mediate homotypic membrane fusion between ER tubules; however, the exact role of lunapark remains poorly characterized. Here, using isolated yeast ER microsomes and reconstituted proteoliposomes, we directly examined the function of the yeast lunapark Lnp1p for yeast atlastin Sey1p-mediated ER fusion and found that Lnp1p inhibits Sey1p-driven membrane fusion. Furthermore, by using a newly developed assay for monitoring trans-Sey1p complex assembly, a prerequisite for ER fusion, we found that assembly of trans-Sey1p complexes was increased by the deletion of LNP1 and decreased by the overexpression of Lnp1p, indicating that Lnp1p inhibits Sey1p-mediated fusion by interfering with assembly of trans-Sey1p complexes.