A novel nonthiazolidinedione dual peroxisome proliferator- activated receptor (PPAR)-α/γ agonist, LY465608, was designed to address the major metabolic disturbances of type 2 diabetes. LY465608 altered PPAR-responsive genes in liver and fat of db/db mice and dose-dependently lowered plasma glucose in hyperglycemic male Zucker diabetic fatty (ZDF) rats, with an ED₅₀ for glucose normalization of 3.8 mg · kg⁻¹ · day⁻¹. Metabolic improvements were associated with enhanced insulin sensitivity, as demonstrated in female obese Zucker (fa/fa) rats using both oral glucose tolerance tests and hyperinsulinemic-euglycemic clamps. Further characterization of LY465608 revealed metabolic changes distinct from a selective PPAR-γ agonist, which were presumably due to the concomitant PPAR-α agonism, lower respiratory quotient, and less fat accumulation, despite a similar impact on glycemia in male ZDF rats. In addition to these alterations in diabetic and insulin-resistant animals, LY465608 dose-dependently elevated HDL cholesterol and lowered plasma triglycerides in human apolipoprotein A-I transgenic mice, demonstrating that this compound significantly improves primary cardiovascular risk factors. Overall, these studies demonstrate that LY465608 beneficially impacts multiple facets of type 2 diabetes and associated cardiovacular risk, including those facets involved in the development of micro- and macrovascular complications, which are the major sources for morbidity and mortality in these patients.