Adiposity-associated inflammation and insulin resistance are strongly implicated in the development of type 2 diabetes and atherosclerotic cardiovascular disease. This article reviews the mechanisms of adipose inflammation, because these may represent therapeutic targets for insulin resistance and for prevention of metabolic and cardiovascular consequences of obesity. The initial insult in adipose inflammation and insulin resistance, mediated by macrophage recruitment and endogenous ligand activation of Toll-like receptors, is perpetuated through chemokine secretion, adipose retention of macrophages, and elaboration of pro-inflammatory adipocytokines. Activation of various kinases modulates adipocyte transcription factors, including peroxisome proliferator-activated receptor-gamma and NFkappaB, attenuating insulin signaling and increasing adipocytokine and free fatty acid secretion. Inflammation retards adipocyte differentiation and further exacerbates adipose dysfunction and inflammation. Paracrine and endocrine adipose inflammatory events induce a local and systemic inflammatory, insulin-resistant state promoting meta-bolic dyslipidemia, type 2 diabetes, and cardiovascular disease. Developing therapeutic strategies that target both adipose inflammation and insulin resistance may help to prevent type 2 diabetes and cardiovascular disease in the emerging epidemic of obesity.