CCAAT/enhancer-binding protein beta (C/EBPbeta) controls gene transcription and metabolic processes in a variety of insulin-sensitive tissues; however, its role in regulating insulin responsiveness in vivo has not been investigated. We performed hyperinsulinemic-euglycemic clamps in awake, non-stressed, chronically catheterized adult mice homozygous for a deletion in the gene for C/EBPbeta (C/EBPbeta(-/-)). Fasting plasma insulin, glucose, and free fatty acid (FFA) levels were significantly lower in C/EBPbeta(-/-) mice compared with wild-type (WT) controls. Acute hyperinsulinemia (4 h) suppressed hepatic glucose production, phosphoenolpyruvate carboxykinase mRNA, and plasma FFA to a similar extent in WT and C/EBPbeta(-/-) mice, suggesting that C/EBPbeta deletion does not alter the metabolic and gene regulatory response to insulin in liver and adipose tissue. In contrast, using submaximal (5 milliunits/kg/min) and maximal (20 milliunits/kg/min) insulin infusions, whole-body glucose disposal was 77% (p < 0.01) and 33% (p < 0.05) higher in C/EBPbeta(-/-) mice, respectively, compared with WT mice. Maximal insulin-stimulated 3-O-methylglucose uptake in isolated soleus muscle was 54% greater in C/EBPbeta(-/-) mice (p < 0.05). Furthermore, insulin-stimulated insulin receptor and Akt Ser(473) phosphorylation and phosphatidylinositol 3-kinase activity were 1.6-2.5-fold greater in skeletal muscle from C/EBPbeta(-/-) mice compared with WT mice. The level of insulin receptor substrate-1 protein was increased 2-fold in skeletal muscle from C/EBPbeta(-/-) mice. These results demonstrate that C/EBPbeta deletion decreases plasma FFA levels and increases insulin signal transduction specifically in skeletal muscle, and both contribute to increased whole-body insulin sensitivity.