The carcinogenic potential of naveglitazar, a gamma-dominant peroxisome proliferator-activated receptor (PPAR) alpha/gamma dual agonist, was evaluated in a two-year study in F344 rats (0, 0.3, 1.0, or 3.0 mg/kg, males; 0, 0.1, 0.3, or 1.0 mg/kg, females). Increased mortality in male rats of the high-dose group was related to cardiac-associated lesions, neoplasms, and undetermined causes. Degeneration and hypertrophy of the myocardium occurred with dose-responsive increased incidence and severity. Neoplasms with increased incidence included sarcomas in male rats and urinary bladder neoplasms in female rats. Most sarcomas in male rats occurred in the adipose tissue of the subcutis and were diagnosed as fibrosarcomas, with fewer liposarcomas and other histologic types. Non-neoplastic changes in adipose tissue included expansion of adipose tissue in multiple sites, alterations in cytoplasmic vesicular pattern in brown and white fat, increases in stroma and mesenchymal cells, and fibrosis. The severity of chronic progressive nephropathy was decreased in a dose-responsive manner in males, and hyperplasia and neoplasia of the mammary gland were decreased in incidence in females. The adverse effects of cardiotoxicity and increased incidence of neoplasms occurred with dose-responsive incidence and/or severity, and a no-effect level for these effects was not achieved in this study.