The Less CSS Preprocessor Drupal module requires installing a LESS engine, but the instructions are confusing.
The LESS Engines documentation page is a little more helpful, except for a missing little twist... Here's how to do it:
libraries/less.php/Less.php, and set the less_engine Drupal variable to "less.php",libraries/lessphp/Less.php, and leave the less_engine Drupal variable unset, defaulting to "lessphp".