Peroxisome proliferator-activated receptor gamma (PPAR gamma) is a nuclear receptor, which upon activation with various natural and synthetic ligands, stimulates the transcription of genes responsible for growth and differentiation of adipocytes. Furthermore, PPAR gamma is the receptor for the insulin-sensitizing thiazolidinediones, which are commonly used for the treatment of type 2 diabetes. Rare inactivating mutations of the gene encoding PPAR gamma are associated with insulin resistance type 2 diabetes, and hypertension, whereas a rare gain of function mutation causes extreme obesity. A common polymorphism (Pro12Ala) of the adipose tissue-specific gamma 2 isoform is associated with increased insulin sensitivity and decreased risk of developing type 2 diabetes. These findings indicate a central role of PPAR gamma in fat cell biology and in the pathophysiology of obesity, diabetes, and insulin resistance.