The peroxisome proliferator-activated receptor-gamma (PPARgamma) binds diverse ligands to transcriptionally regulate metabolism and inflammation. Activators of PPARgamma include lipids and anti-hyperglycemic drugs such as thiazolidinediones (TZDs). Recently, TZDs have raised concern after being linked with increased risk of peripheral edema, weight gain, and adverse cardiovascular events. Most reported endogenous PPARgamma ligands are intermediates of lipid metabolism and oxidation that bind PPARgamma with very low affinity. In contrast, nitro derivatives of unsaturated fatty acids (NO(2)-FA) are endogenous products of nitric oxide ((*)NO) and nitrite (NO(2)(-))-mediated redox reactions that activate PPARgamma at nanomolar concentrations. We report that NO(2)-FA act as partial agonists of PPARgamma and covalently bind PPARgamma at Cys-285 via Michael addition. NO(2)-FA show selective PPARgamma modulator characteristics by inducing coregulator protein interactions, PPARgamma-dependent expression of key target genes, and lipid accumulation is distinctively different from responses induced by the TZD rosiglitazone. Administration of this class of signaling mediators to ob/ob mice revealed that NO(2)-FA lower insulin and glucose levels without inducing adverse side effects such as the increased weight gain induced by TZDs.