Mechanisms to coordinately regulate energy expenditure and glucose uptake into muscle and fat cells are not well described. Insulin stimulates glucose uptake in part by causing site-specific endoproteolytic cleavage of TUG, which mobilizes GLUT4 glucose transporters to the cell surface. Here, we show that the TUG C-terminal cleavage product enters the nucleus, binds the transcriptional regulators PGC-1a and PPARg, and increases oxidative metabolism and thermogenic protein expression. Muscle-specific genetic manipulation of this pathway impacts whole-body energy expenditure, independent of glucose uptake. The PPARg2 Pro12Ala polymorphism, which reduces diabetes risk, enhances TUG binding. The TUG cleavage product stabilizes PGC-1a and is itself susceptible to an Ate1 arginyltransferase -dependent degradation mechanism; binding of the TUG product confers Ate1-dependent stability upon PGC-1a. We conclude that TUG cleavage coordinates energy expenditure with glucose uptake, that this pathway may contribute to the thermic effect of food, and that its attenuation may be important in obesity..