Peroxisome proliferator-activated receptor gamma (PPAR gamma) agonists, including the glitazone class of drugs, are insulin sensitizers that reduce glucose and lipid levels in patients with type 2 diabetes mellitus. To more fully understand the molecular mechanisms underlying their therapeutic actions, we have characterized the effects of the potent, tyrosine-based PPAR gamma ligand GW1929 on serum glucose and lipid parameters and gene expression in Zucker diabetic fatty rats. In time-course studies, GW1929 treatment decreased circulating FFA levels before reducing glucose and triglyceride levels. We used a comprehensive and unbiased messenger RNA profiling technique to identify genes regulated either directly or indirectly by PPAR gamma in epididymal white adipose tissue, interscapular brown adipose tissue, liver, and soleus skeletal muscle. PPAR gamma activation stimulated the expression of a large number of genes involved in lipogenesis and fatty acid metabolism in both white adipose tissue and brown adipose tissue. In muscle, PPAR gamma agonist treatment decreased the expression of pyruvate dehydrogenase kinase 4, which represses oxidative glucose metabolism, and also decreased the expression of genes involved in fatty acid transport and oxidation. These changes suggest a molecular basis for PPAR gamma-mediated increases in glucose utilization in muscle. In liver, PPAR gamma activation coordinately decreased the expression of genes involved in gluconeogenesis. We conclude from these studies that the antidiabetic actions of PPAR gamma agonists are probably the consequence of 1) their effects on FFA levels, and 2), their coordinate effects on gene expression in multiple insulin-sensitive tissues.