Emerging evidence suggests that impaired regulation of adipocyte lipolysis contributes to the proinflammatory immune cell infiltration of metabolic tissues in obesity, a process that is proposed to contribute to the development and exacerbation of insulin resistance. To test this hypothesis in vivo, we generated mice with adipocyte-specific deletion of adipose triglyceride lipase (ATGL), the rate-limiting enzyme catalyzing triacylglycerol hydrolysis. In contrast to previous models, adiponectin-driven Cre expression was used for targeted ATGL deletion. The resulting adipocytespecific ATGL knockout (AAKO) mice were then characterized for metabolic and immune phenotypes. Lean and diet-induced obese AAKO mice had reduced adipocyte lipolysis, serum lipids, systemic lipid oxidation,andexpression of peroxisome proliferator-activated receptor alpha target genes in adipose tissue (AT) and liver. These changes did not increase overall body weight or fat mass in AAKO mice by 24 weeks of age, in part due to reduced expression of genes involved in lipid uptake, synthesis, and adipogenesis. Systemic glucose and insulin tolerance were improved in AAKO mice, primarily due to enhanced hepatic insulin signaling, which was accompanied by marked reduction in diet-induced hepatic steatosis as well as hepatic immune cell infiltration and activation. In contrast, although adipocyte ATGL deletion reduced AT immune cell infiltration in response to an acute lipolytic stimulus, it was not sufficient to ameliorate, and may even exacerbate, chronic inflammatory changes that occur in AT in response to diet-induced obesity.