White adipose tissue (WAT) plays a critical role in the development of insulin resistance via secretion of free fatty acids (FFA) and adipocytokines. Muscle-specific insulin receptor knockout (MIRKO) mice do not develop insulin resistance or diabetes under physiological conditions despite a marked increase in adiposity and plasma FFA. On the contrary, WAT of MIRKO is sensitized to insulin action during a euglycemic clamp, and WAT glucose utilization is dramatically increased. To get insight into the potential antidiabetic role of MIRKO adiposity, we have studied insulin action in WAT during a euglycemic, hyperinsulinemic clamp, and we have characterized the morphology and biology of WAT. During the clamp, there is no alteration in the expression or activation in the insulin signaling molecules involved in glucose transport through the phosphoinositide 3-kinase/Akt and CAP/Cbl pathways in WAT from MIRKO. The 53% increase in WAT mass results from a 48% increase in adipocyte number (P < 0.05) without alteration in cell size and contemporary to a 300% increase in mRNA levels of the adipogenic transcription factor CCAAT enhancer binding protein-alpha (C/EBP-alpha) (P < 0.05). There is a 39.5% increase in serum adiponectin (P < 0.01) without modification in serum leptin, resistin, and TNF-alpha. In conclusion, the MIRKO mouse displays muscle insulin resistance, visceral obesity, and dyslipidemia but does not develop hyperinsulinemia or diabetes. There is an accelerated differentiation of small insulin sensitive adipocytes, an increased secretion of the insulin sensitizer adiponectin, and maintenance of leptin sensitivity. The MIRKO mouse confirms the importance of WAT plasticity in the maintenance of whole body insulin sensitivity and represents an interesting model to search for new secreted molecules that positively alter adipose tissue biology.