The effect of a new drug (CP 68,722, Pfizer) on parameters of insulin sensitivity in an established insulin-resistant animal model was examined. Rates of hepatic glucose production (HGP) and peripheral glucose uptake in obese Zucker (fa fa) rats treated with a 10-day course of the medication using a two-step (2 and 10 mU/kg/min) euglycemic hyperinsulinemic clamp technique were measured. In addition, changes in substrate concentrations after drug treatment were examined. Basal HGP rates were similar in the lean versus the obese animals (37±3 v 39±3 μmol/kg/min); however, the obese animals had impaired insulin-induced suppression of HGP at both 2 mU/kg/min (36±3 v 23±4 μmol/kg/min) and 10 mU/kg/min (18±5 v 2±1 μmol/kg/min). Insulin stimulation of glucose disposal was also defective in the obese animals (37±2 v 88±7 μmol/kg/min at 2 mU/kg/min and 98±9 v 219±18 μmol/kg/min at 10 mU/kg/min). In addition, obese animals had elevated free fatty acid (FFA) and ketone levels, both of which were resistant to insulin-induced suppression. After drug treatment, few alterations in glucose or lipid metabolism were found in the lean animals. In the obese animals, insulin suppression of HGP was normalized during the higher insulin infusion rate (0 v 18±5 μmol/kg/min at 10 mU/kg/min), and peripheral glucose disposal was enhanced at both steps of the insulin clamp (54±4 v 37±2 μmol/kg/min at 2 mU/kg/min and 134±12 v 98±9 μmol/kg/min at 10 mU/kg/min). Drug treatment lowered both fasting and insulin-stimulated suppression of FFA and ketone concentrations in the obese rat. An unexpected finding was that drug treatment resulted in a marked acceleration of insulin clearance, such that basal insulin levels were reduced, as were insulin levels during the first steps of the insulin clamp. These results suggest that CP 68,722 acts at both the liver and skeletal muscle tissues to enhance insulin sensitivity, and thus may prove to be a useful medication in patients with insulin-resistant diabetes mellitus.