We performed a combination of single-variant- and haplotype-based analyses to investigate the association of peroxisome-proliferator-activated receptor gamma (PPARgamma) gene sequence variation with indices of adiposity, including body mass index (BMI) and waist girth, as well as insulin action, including fasting blood glucose and insulin levels. Nine polymorphisms, selected based on race-specific pairwise linkage disequilibrium relations and/or potential functional relevance, were assayed in 3,875 African-American and white young adults from the Coronary Artery Risk Development in Young Adults Study. These polymorphisms were C25819G (C-681G), C65746G (Pro12Ala), G67222A, A69208G, G81556T, T95872C, T115432G, C127599T, and C148157T (C1431T). They defined seven and six common haplotypes in African-Americans and whites, respectively. Patterns of associations of PPARgamma genetic variation with the metabolic traits differed between the two racial groups, with some exceptions. Haplotype CCGGCTCC was associated with a significant reduction in glucose levels in both racial groups (P<0.001 in each group), and the G69208 allele was associated with lower glucose levels in lean African-Americans and in whites (both P=0.02). Two haplotypes, relatively unique to whites, were associated with measures of adiposity and glucose levels. Two haplotypes, relatively unique to African-Americans, were associated with glucose levels. There were no significant effects of PPARgamma haplotypes on measures of body size in this racial group, but a novel polymorphism, G67222A, significantly modulated the relation between BMI and glucose levels (P interaction, 0.003). This study provides evidence that variants, other than Pro12Ala, influence variation in body size and indices of insulin action. It underscores the role of genetic and environmental contexts in shaping the patterns of associations of PPARgamma sequence variants with metabolic traits in human populations.