Wolbachia are a genus of insect endosymbiotic bacteria which includes strains wMel and wAlbB that are being utilized as a biocontrol tool to reduce the incidence of Aedes aegypti-transmitted viral diseases like dengue. However, the precise mechanisms underpinning the antiviral activity of these Wolbachia strains are not well defined. Here, we generated a panel of Ae. aegypti-derived cell lines infected with antiviral strains wMel and wAlbB or the non-antiviral Wolbachia strain wPip to understand host cell morphological changes specifically induced by antiviral strains. Antiviral strains were frequently found to be entirely wrapped by the host endoplasmic reticulum (ER) membrane, while wPip bacteria clustered separately in the host cell cytoplasm. ER-derived lipid droplets (LDs) increased in volume in wMel- and wAlbB-infected cell lines and mosquito tissues compared to cells infected with wPip or Wolbachia-free controls. Inhibition of fatty acid synthase (required for triacylglycerol biosynthesis) reduced LD formation and significantly restored ER-associated dengue virus replication in cells occupied by wMel. Together, this suggests that antiviral Wolbachia strains may specifically alter the lipid composition of the ER to preclude the establishment of dengue virus (DENV) replication complexes. Defining Wolbachia’s antiviral mechanisms will support the application and longevity of this effective biocontrol tool that is already being used at scale.