During differentiation, expression of protein phosphatase-2C␣ (PP2C␣) is increased in 3T3-L1 adipocytes.To elucidate the role of PP2C␣ in insulin signaling, we overexpressed wild-type (WT) PP2C␣ by adenovirus-mediated gene transfer in 3T3-L1 adipocytes. Overexpression of PP2C␣-WT enhanced the insulin sensitivity of glucose uptake without any changes in the early steps of insulin signaling. Infection with adenovirus 5 expressing PP2C␣-WT increased phosphatidylinositol 3-kinase (PI3K) activities in the immunoprecipitate using antibody against the p85 or p110 subunit under both basal and insulin-stimulated conditions, followed by activation of downstream steps in the PI3K pathway, such as phosphorylation of Akt, glycogen synthase kinase-3, and atypical protein kinase C. In contrast, overexpression of the phosphatase-defective mutant PP2C␣(R174G) did not produce such effects. Furthermore, overexpression of PP2C␣-WT (but not PP2C␣(R174G)) decreased the 32 P-labeled phosphorylation state as well as the gel mobility shift of the p85 subunit, suggesting that dephosphorylation of the p85 subunit by PP2C␣ activation might stimulate PI3K catalytic activity. Moreover, knockdown of PP2C␣ by transfection of small interfering RNA led to a significant decrease in Akt phosphorylation. In addition, microinjection of anti-PP2C␣ antibody or PP2C␣ small interfering RNA led to decreased insulin-stimulated GLUT4 translocation. In conclusion, PP2C␣ is a new positive regulator of insulin sensitivity that acts through a direct activation of PI3K in 3T3-L1 adipocytes.Phosphorylation state is regulated by both protein kinase and protein phosphatase and is critical for the regulation of cellular functions such as cell growth, differentiation, and metabolism (1, 2). The protein phosphatases of eukaryotic cells are structurally and functionally diverse enzymes that can be divided into two distinct families (serine/threonine phosphatases and protein-tyrosine phosphatases) based on their specificities for phosphoamino acids (3, 4). Serine/threonine phosphatases are further classified into four major groups (protein phosphatase (PP) 1 -1, PP2A, PP2B, and PP2C␣) depending on their substrate specificities, bivalent cation dependences, and sensitivities to various inhibitor molecules such as protein inhibitor-1 and -2 and the tumor promoter okadaic acid (3, 5).The role of protein-tyrosine phosphatases in insulin signaling has been well characterized in several recent studies (6 -11). As does tyrosine phosphorylation, serine/threonine phosphorylation plays important roles in insulin signal transduction. A major role in the negative regulation of insulin action is attributed to agents that enhance serine/threonine phosphorylation of the receptor itself or its downstream effectors such as insulin receptor substrate-1 (IRS-1). Serine/threonine phosphorylation of such molecules induces insulin resistance. Furthermore, Akt and atypical protein kinase C (PKC ) are serine/threonine kinases, and their kinase activities are regulated through the serine/threo...