The peroxisome proliferator-activated receptor gamma (PPARgamma) is nuclear receptor that controls the expression of a large number of genes involved in adipocyte differentiation, lipid storage and insulin sensitization. PPARgamma is bound and activated by fatty acid derivatives and prostaglandin J2. In addition, thiazolidinediones, non-steroidal anti-inflammatory drugs are synthetic ligands and agonists of this receptor. This review addresses the role of PPARgamma in obesity and diabetes.