Three cysteine residues in the cytoplasmic tail of influenza virus glycoprotein hemagglutinin (HA) are covalently modified by three fatty acids and highly conserved among HA subtypes. The importance of these S-acylation post-translational modifications is highlighted by a strain-dependence to their role in virus replication either in assembly or in fusion, but the mechanisms by which the modifications exerts any effect are unknown. We studied the effects of HA acylation on influenza virus-like particle (VLP) morphology, glycoprotein spacing, protein incorporation, HA induced curvature, and membrane fusion using cryo-electron tomography (cET), VLP-cell and cell-cell fusion assays, and molecular dynamics. Acylation has a significant effect on VLP envelope curvature but is not a determinant of either VLP morphology or HA lateral spacing. De-acylated mutant HA is correlated with a flatter envelope curvature of the released particles in the absence of the M1 layer compared to wild type HA. The de-acylated mutant HA failed to incorporate an M1 layer within spherical VLP consistent with altered HA-M1 interactions. In cell-cell fusion assays, fusion pore enlargement was not observed, regardless of which strain of influenza was de-acylated (H2 (A/Japan/305/57), H3 (A/Aichi/2/68), H3 (A/Udorn/72)), suggesting that the role of acylation in membrane fusion is viral strain independent. Fusion without pore enlargement could be partially rescued by the expression of M1 and M2 proteins. The spontaneous curvature of palmitate was calculated by molecular dynamic simulations, and was found to be comparable to curvature values derived from VLP size distributions. Our studies indicate that HA acylation is important for both influenza virus assembly and membrane fusion by controlling membrane curvature and modifying HA's interactions with M1.