Thiazolidinediones offer promise as oral insulin-sensitizing agents. The effects of a new, high-potency compound (BRL 49653, SmithKline Beecham, Epsom, U.K.) were examined in insulin-resistant (high-fat–fed, HF) and control (high-starch–fed, HS) rats. The diet period was 3 weeks, with a BRL 49653 (10 μmol · kg⁻¹ · day⁻¹) or vehicle gavage on the last 4 days. Then basal or euglycemic clamp studies were performed on animals in the conscious fasted state. In the basal state, BRL 49653 produced many similar metabolic responses in HF and HS rats (reduced insulin, glycerol, ketone body, and nonesterified fatty acid levels, reduced whole body glucose turnover, reduced brown adipose tissue glucose metabolism, and increased cardiac glucose metabolism and GLUT4 levels). In contrast, under euglycemic clamp conditions (500 pmol/l insulin), BRL 49653 only induced changes in the HF group (increased glucose infusion rate from 12.2 ± 0.9 to 21.6 ± 1.1 mg · kg⁻¹ · min⁻¹ [P < 0.001], increased insulin suppressibility of hepatic glucose production [P < 0.01], and increased glucose uptake in muscle [P < 0.01]). BRL 49653 significantly reduced liver but not muscle triglyceride content in HF rats. We conclude that the agent has a general effect on lowering circulating lipid and insulin levels, manifested similarly in normal and insulin-resistant rats, but that enhancement of peripheral insulin action is confined to insulin-resistant rats. Therefore, the hypoinsulinemic action of the thiazolidinediones is probably not related simply to improved peripheral insulin sensitivity. The pattern of individual tissue response to BRL 49653 suggests that altered lipid availability is an important mediator of its effects on glucose metabolism.