Prohibitins comprise an evolutionarily conserved and ubiquitously expressed family of membrane proteins with poorly described functions. Large assemblies of PHB1 and PHB2 subunits are localized in the inner membrane of mitochondria, but various roles in other cellular compartments have also been proposed for both proteins. Here, we used conditional gene targeting of murine Phb2 to define cellular activities of prohibitins. Our experiments restrict the function of prohibitins to mitochondria and identify the processing of the dynamin-like GTPase OPA1, an essential component of the mitochondrial fusion machinery, as the central cellular process controlled by prohibitins. Deletion of Phb2 leads to the selective loss of long isoforms of OPA1. This results in an aberrant cristae morphogenesis and an impaired cellular proliferation and resistance toward apoptosis. Expression of a long OPA1 isoform in PHB2-deficient cells suppresses these defects, identifying impaired OPA1 processing as the primary cellular defect in the absence of prohibitins. Our results therefore assign an essential function for the formation of mitochondrial cristae to prohibitins and suggest a coupling of cell proliferation to mitochondrial morphogenesis.