S-Palmitoylation is a reversible lipid post-translational modification that has been observed on mitochondrial proteins, but both the regulation and functional consequences of mitochondrial S-palmitoylation are poorly understood. Here, we show that perturbing the 'erasers' of S-palmitoylation, acyl protein thioesterases (APTs), with either pan-active inhibitors or a mitochondrial-targeted APT inhibitor, diminishes the antioxidant buffering capacity of mitochondria. Surprisingly, this effect was not mediated by the only known mitochondrial APT, but rather by a resident mitochondrial protein with no known endogenous function, ABHD10. We show that ABHD10 is a member of the APT family of regulatory proteins and identify peroxiredoxin-5 (PRDX5), a key antioxidant protein, as a target of ABHD10 S-depalmitoylase activity. We then find that ABHD10 regulates the S-palmitoylation status of the nucleophilic active site residue of PRDX5, providing a direct mechanistic connection between ABHD10-mediated S-depalmitoylation of PRDX5 and its antioxidant capacity.