Rodent and in vitro studies suggest that thiazolidinediones promote adipogenesis but there are few studies in humans to corroborate these findings. The purpose of this study was to determine whether pioglitazone stimulates adipogenesis in vivo and whether this process relates to improved insulin sensitivity. To test this hypothesis, 12 overweight/obese nondiabetic, insulin-resistant individuals underwent biopsy of abdominal subcutaneous adipose tissue at baseline and after 12 weeks of pioglitazone treatment. Cell size distribution was determined via the Multisizer technique. Insulin sensitivity was quantified at baseline and postpioglitazone by the modified insulin suppression test. Regional fat depots were quantified by computed tomography (CT). Insulin resistance (steady-state plasma insulin and glucose (SSPG)) decreased following pioglitazone (P < 0.001). There was an increase in the ratio of small-to-large cells (1.16 +/- 0.44 vs. 1.52 +/- 0.66, P = 0.03), as well as a 25% increase in the absolute number of small cells (P = 0.03). The distribution of large cell diameters widened (P = 0.009), but diameter did not increase in the case of small cells. The increase in proportion of small cells was associated with the degree to which insulin resistance improved (r = -0.72, P = 0.012). Visceral abdominal fat decreased (P = 0.04), and subcutaneous abdominal (P = 0.03) and femoral fat (P = 0.004) increased significantly. Changes in fat volume were not associated with SSPG change. These findings demonstrate a clear effect of pioglitazone on human subcutaneous adipose cells, suggestive of adipogenesis in abdominal subcutaneous adipose tissue, as well as redistribution of fat from visceral to subcutaneous depots, highlighting a potential mechanism of action for thiazolidinediones. These findings support the hypothesis that defects in subcutaneous fat storage may underlie obesity-associated insulin resistance.