The lipid layer of the tear film is produced by the meibomian glands, which are located in the upper and lower eyelids.
Many, many dry eye patients do not actually have "dry eyes" in the sense of a failure to produce enough watery tears, but rather have a poor lipid layer so they have excessive evaporative loss of tears. This is often referred to as evaporative dry eye. See Meibomian Gland Dysfunction for discussion on why this happens and how it can be improved.
