Neuropeptide Y (NPY) is synthesized in neural tissue of the central and peripheral nervous systems and has a number of important functions besides regulating appetite and energy homeostasis. Here we identify a novel site of NPY biosynthesis and a role for NPY in promoting proliferation of adipocyte precursor cells. We show that NPY mRNA is not only expressed in visceral adipose tissue (VAT) but that its levels are up-regulated 6-fold in our early-life programmed rat model of increased visceral adiposity. This is accompanied by a parallel rise in NPY protein, demonstrating that VAT is a novel peripheral site of NPY biosynthesis. Furthermore, NPY mRNA expression is also elevated >2-fold in VAT of obese Zucker rats. Importantly, NPY stimulates proliferation of primary rat preadipocytes as well as 3T3-L1 preadipocytes in vitro. This mitogenic effect appears to be mediated by the Y1 receptor and involves the activation of extracellular related kinase 1/2. In addition, insulin and glucocorticoid up-regulate VAT NPY expression in lean but not obese Zucker rats. Taken together, these results suggest that an enhanced local expression of NPY within VAT may be a common feature of and contribute to the molecular mechanisms underlying increased visceral adiposity.