Mobilization of hematopoietic stem/progenitor cells (HSPC) from the bone marrow (BM) is impaired in diabetes. Excess oncostatin M (OSM) produced by M1 macrophages in the diabetic BM signals through p66Shc to induce Cxcl12 in stromal cells and retain HSPC. BM adipocytes are another source of CXCL12 that blunts mobilization. We tested a strategy of pharmacologic macrophage reprogramming to rescue HSPC mobilization. In vitro, PPAR-g activation with pioglitazone switched macrophages from M1 to M2, reduced Osm expression, and prevented transcellular induction of Cxcl12. In diabetic mice, pioglitazone treatment downregulated Osm, p66Shc, and Cxcl12 in the hematopoietic BM, restored the effects of granulocytecolony stimulation factor (G-CSF), and partially rescued HSPC mobilization, but it increased BM adipocytes. Osm deletion recapitulated the effects of pioglitazone on adipogenesis, which was p66Shc independent, and double knockout of Osm and p66Shc completely rescued HSPC mobilization. In the absence of OSM, BM adipocytes produced less CXCL12, being arguably devoid of HSPC-retaining activity, whereas pioglitazone failed to downregulate Cxcl12 in BM adipocytes. In patients with diabetes on pioglitazone therapy, HSPC mobilization after G-CSF was partially rescued. In summary, pioglitazone reprogrammed BM macrophages and suppressed OSM signaling, but sustained Cxcl12 expression by BM adipocytes could limit full recovery of HSPC mobilization.