Dual agonism of glucagon and glucagon-like peptide-1 (GLP-1) receptors reduce body weight without inducing hyperglycemia in rodents. However, the effect of a co-agonist on insulin sensitivity and lipid metabolism has not been thoroughly assessed. Diet-induced obese (DIO) mice received 0.5 mg·kg(-1) of co-agonist or 2.5 mg·kg(-1) of glucagon or 8 μg·kg(-1) of exendin-4 by subcutaneous route, twice daily, for 28 days. A separate group of mice was pair-fed to the co-agonist-treated group for 28 days. Co-agonist treatment reduced food intake and reduced body weight up to 28 days. In addition, it reduced leptin levels and increased fibroblast growth factor 21 (FGF21) levels in plasma, when compared with control and pair-fed groups. Co-agonist treatment decreased triglyceride levels in serum and liver and reduced serum cholesterol, mainly due to reduction in low-density lipoprotein (LDL) cholesterol. These changes were not seen with pair-fed controls. Co-agonist treatment improved glucose tolerance and increased insulin sensitivity, as observed during glucose and insulin-tolerance test, hyperinsulinemic clamp, and reduced gluconeogenesis, as observed in pyruvate-tolerance test. The effects on insulin sensitivity and lipid levels are mostly independent of the food intake or body weight lowering effect of the co-agonist.