Organelles such as endoplasmic reticulum (ER) and mitochondria interact with each other at specialized domains on the ER known as mitochondria-associated membranes (MAMs). Here, using three-dimensional high-resolution imaging techniques, we show that the Sel1LHrd1 protein complex, the most conserved branch of ER-associated protein degradation (ERAD), exerts a profound impact on ER-mitochondria contacts and mitochondrial dynamics, at least in part, by regulating the turnover and hence the abundance of the MAM protein sigma receptor 1 (SigmaR1). Sel1L or Hrd1 deficiency in brown adipocytes impairs dynamic interaction between ER and mitochondria, leading to the formation of pleomorphic “megamitochondria” and, in some cases with penetrating ER tubule(s), in response to acute cold challenge. Mice with ERAD deficiency are cold sensitive and exhibit mitochondrial dysfunction in brown adipocytes. Mechanistically, endogenous SigmaR1 is targeted for proteasomal degradation by Sel1L-Hrd1 ERAD, whose accumulation in ERAD-deficient cells leads to mitofusin 2 (Mfn2) oligomerization, thereby linking ERAD to mitochondrial dynamics. Our study identifies Sel1L-Hrd1 ERAD as a critical determinant of ER-mitochondria contacts, thereby regulating mitochondrial dynamics and thermogenesis.