Obesity is a strong risk factor for the development of type 2 diabetes. We have previously reported that in adipose tissue of obese (ob/ob) mice, the expression of adipogenic genes is decreased. When made genetically obese, the BTBR mouse strain is diabetes susceptible and the C57BL/6J (B6) strain is diabetes resistant. We used DNA microarrays and RT-PCR to compare the gene expression in BTBR-ob/ob versus B6-ob/ob mice in adipose tissue, liver, skeletal muscle, and pancreatic islets. Our results show: 1) there is an increased expression of genes involved in inflammation in adipose tissue of diabetic mice; 2) lipogenic gene expression was lower in adipose tissue of diabetes-susceptible mice, and it continued to decrease with the development of diabetes, compared with diabetes-resistant obese mice; 3) hepatic expression of lipogenic enzymes was increased and the hepatic triglyceride content was greatly elevated in diabetes-resistant obese mice; 4) hepatic expression of gluconeogenic genes was suppressed at the prediabetic stage but not at the onset of diabetes; and 5) genes normally not expressed in skeletal muscle and pancreatic islets were expressed in these tissues in the diabetic mice. We propose that increased hepatic lipogenic capacity protects the B6-ob/ob mice from the development of type 2 diabetes.