Tuberculosis, once thought to have been controlled, is now resurgent in many parts of the world. Many gaps exist in understanding the pathogenesis of tuberculosis, especially secondary and cavitary disease. Evidence presented here suggests that cord factor (trehalose 6,6′-dimycolate, TDM) is a key driver of these processes. It is the most abundant lipid released by virulent M. tuberculosis (MTB) and can switch between two sets of activities. On organisms, TDM is non-toxic and protects them from killing by macrophages. On lipid surfaces, it becomes antigenic and highly toxic. Caseating granulomas, the hallmark of primary tuberculosis, develop from interaction of TDM with lipid within granulomas. New evidence indicates that secondary tuberculosis begins as a lipid pneumonia that accumulates mycobacterial antigens and host lipids in alveoli before developing conditions for activation of the toxicity and antigenicity of TDM. This rapidly produces caseation necrosis that leads to cavities. Finally, virulent MTB release large amounts of TDM during growth as a pellicle within cavities. We propose that such growth results in activation of the toxicity and antigenicity of TDM at the air interface and that presence of the activated TDM perpetuates the cavity.