Adipose tissue-derived cytokines (adipokines) are associated with the development of inflammation and insulin resistance. However, which adipokine(s) mediate this linkage and the mechanisms involved during obesity is poorly understood. Through proteomics and microarray screening, we recently identified lipocalin 2 (LCN 2) as an adipokine that potentially connects obesity and its related adipose inflammation. Herein we show that the levels of LCN2 mRNA are dramatically increased in adipose tissue and liver of ob/ob mice and primary adipose cells isolated from Zucker obese rats, and thiazolidinedione administration reduces LCN2 expression. Interestingly, addition of LCN2 induces mRNA levels of peroxisome proliferator-activated receptor-gamma (PPARgamma) and adiponectin. Reducing LCN2 gene expression causes decreased expression of PPARgamma and adiponectin, slightly reducing insulin-stimulated Akt2 phosphorylation at Serine 473 in 3T3-L1 adipocytes. LCN2 administration to 3T3-L1 cells attenuated TNFalpha-effect on glucose uptake, expression of PPARgamma, insulin receptor substrate-1, and glucose transporter 4, and secretion of adiponectin and leptin. When added to macrophages, LCN2 suppressed lipopolysaccharide-induced cytokine production. Our data suggest that LCN2, as a novel autocrine and paracrine adipokine, acts as an antagonist to the effect of inflammatory molecules on inflammation and secretion of adipokines.