The silencing mediator of retinoid and thyroid hormone receptors (SMRT) serves as a corepressor for nuclear receptors and other factors. Recent evidence suggests that SMRT is an important regulator of metabolism, but its role in adipocyte function in vivo remains unclear. We generated heterozygous SMRT knock-out (SMRT(+/-)) mice to investigate the function of SMRT in the adipocyte and the regulation of adipocyte insulin sensitivity. We show that SMRT(+/-) mice are normal weight on a regular diet, but develop increased adiposity on a high-fat diet (HFD). The mechanisms underlying this phenotype are complex, but appear to be due to a combination of an increased number of smaller subcutaneous adipocytes as well as decreased leptin expression, resulting in greater caloric intake. In addition, adipogenesis of mouse embryonic fibroblasts (MEFs) derived from these mice was increased. However, adipocyte insulin sensitivity, measured by insulin-induced Akt phosphorylation and insulin-mediated suppression of lipolysis, was enhanced in SMRT(+/-) adipocytes. These finding suggest that SMRT regulates leptin expression and limits the ability of fat mass to expand with increased caloric intake, but that SMRT also negatively regulates adipocyte insulin sensitivity.