Type 2 diabetes is a complex disease that is marked by the dysfunction of glucose and lipid metabolism. Hepatic insulin resistance is especially pathogenic in type 2 diabetes, as it dysregulates fasting and postprandial glucose tolerance and promotes systemic dyslipidemia and nonalcoholic fatty liver disease. Mitochondrial dysfunction is closely associated with insulin resistance and might contribute to the progression of diabetes. Here we used previously generated mice with hepatic insulin resistance owing to the deletion of the genes encoding insulin receptor substrate-1 (Irs-1) and Irs-2 (referred to here as double-knockout (DKO) mice) to establish the molecular link between dysregulated insulin action and mitochondrial function. The expression of several forkhead box O1 (Foxo1) target genes increased in the DKO liver, including heme oxygenase-1 (Hmox1), which disrupts complex III and IV of the respiratory chain and lowers the NAD(+)/NADH ratio and ATP production. Although peroxisome proliferator-activated receptor-gamma coactivator-1alpha (Ppargc-1alpha) was also upregulated in DKO liver, it was acetylated and failed to promote compensatory mitochondrial biogenesis or function. Deletion of hepatic Foxo1 in DKO liver normalized the expression of Hmox1 and the NAD(+)/NADH ratio, reduced Ppargc-1alpha acetylation and restored mitochondrial oxidative metabolism and biogenesis. Thus, Foxo1 integrates insulin signaling with mitochondrial function, and inhibition of Foxo1 can improve hepatic metabolism during insulin resistance and the metabolic syndrome.