Acetyl–CoA carboxylase 2 (ACC)2 is a key regulator of mitochondrial fat oxidation. To examine the impact of ACC2 deletion on whole-body energy metabolism, we measured changes in substrate oxidation and total energy expenditure in Acc2^−/− and WT control mice fed either regular or high-fat diets. To determine insulin action in vivo, we also measured whole-body insulin-stimulated liver and muscle glucose metabolism during a hyperinsulinemic–euglycemic clamp in Acc2^−/− and WT control mice fed a high-fat diet. Contrary to previous studies that have suggested that increased fat oxidation might result in lower glucose oxidation, both fat and carbohydrate oxidation were simultaneously increased in Acc2^−/− mice. This increase in both fat and carbohydrate oxidation resulted in an increase in total energy expenditure, reductions in fat and lean body mass and prevention from diet-induced obesity. Furthermore, Acc2^−/− mice were protected from fat-induced peripheral and hepatic insulin resistance. These improvements in insulin-stimulated glucose metabolism were associated with reduced diacylglycerol content in muscle and liver, decreased PKCθ activity in muscle and PKCε activity in liver, and increased insulin-stimulated Akt2 activity in these tissues. Taken together with previous work demonstrating that Acc2^−/− mice have a normal lifespan, these data suggest that Acc2 inhibition is a viable therapeutic option for the treatment of obesity and type 2 diabetes.