Peroxisome proliferator activated-receptor (PPAR) isoforms, alpha and gamma, function as important coregulators of energy (lipid) homeostasis. PPARalpha regulates fatty acid oxidation primarily in liver and to a lesser extent in adipose tissue, whereas PPARgamma serves as a key regulator of adipocyte differentiation and lipid storage. Of the two PPARgamma isoforms, PPARgamma1 and PPARgamma2 generated by alternative splicing, PPARgamma1 isoform is expressed in liver and other tissues, whereas PPARgamma2 isoform is expressed exclusively in adipose tissue where it regulates adipogenesis and lipogenesis. Since the function of PPARgamma1 in liver is not clear, we have, in this study, investigated the biological impact of overexpression of PPARgamma1 in mouse liver. Adenovirus-PPARgamma1 injected into the tail vein induced hepatic steatosis in PPARalpha(-/-) mice. Northern blotting and gene expression profiling results showed that adipocyte-specific genes and lipogenesis-related genes are highly induced in PPARalpha(-/-) livers with PPARgamma1 overexpression. These include adipsin, adiponectin, aP2, caveolin-1, fasting-induced adipose factor, fat-specific gene 27 (FSP27), CD36, Delta(9) desaturase, and malic enzyme among others, implying adipogenic transformation of hepatocytes. Of interest is that hepatic steatosis per se, induced either by feeding a diet deficient in choline or developing in fasted PPARalpha(-/-) mice, failed to induce the expression of these PPARgamma-regulated adipogenesis-related genes in steatotic liver. These results suggest that a high level of PPARgamma in mouse liver is sufficient for the induction of adipogenic transformation of hepatocytes with adipose tissue-specific gene expression and lipid accumulation. We conclude that excess PPARgamma activity can lead to the development of a novel type of adipogenic hepatic steatosis.