Thiazolidinediones are ora insulin-sensitizing agents that may be useful for the treatment of non—insulin-dependent diabetes mellitus (NIDDM). BRL 49653 ameliorates insulin resistance and improves glucoregulation in high-fat—fed (HF) rats. It is known that thiazolidinediones bind to the peroxisome proliferator—activated receptor (PPARγ) in fat cells, but the extent to which the improved glucoregulation and hypolipidemic effects relate to adipose tissue requires clarification. We therefore examined BRL 49653 effects on lipid metabolism in HF and control (high-starch—fed [HS]) rats. The diet period was 3 weeks, with BRL 49653 (10 μmol/kg/d) or vehicle garage administered over the last 4 days. Studies were performed on animals in the conscious fasted state. In HF rats, rate constants governing ³H-palmitate clearance were unaffected by BRL 49653. This finding, taken with a concurrent decrease of fasting plasma nonesterified fatty acids (NEFA) (P < .01, ANOVA), demonstrated that systemic NEFA supply and hence absolute utilization are reduced by BRL 49653. Hepatic triglyceride (TG) production (HTGP) assessed using Triton WFI1339 was unaffected by diet or BRL 49653. In liver, BRL 49653 increased insulin-stimulated conversion of glucose into fatty acid in both HF (by 270%) and HS (by 30%) groups (P < .05), Relative to HS rats, HF animals had substantially elevated levels of muscle diglyceride (diacylglycerol [DG] by 240%, P < .001). BRL 49653 significantly reduced muscle DG in HF (by 30%, P < .05) but not in HS rats. The agent did not reduce the intake of dietary lipid. In conclusion, these results are consistent with a primary action of BRL 49653 in adipose tissue to conserve lipid by reducing systemic lipid supply and subsequent utilization. The parallel effects of diet and BRL 49653 treatment on insulin resistance and muscle acylglyceride levels support the involvement of local lipid oversupply in the generation of muscle insulin resistance.