Adiponectin is an adipocyte-derived hormone with antidiabetic activities that include increasing the sensitivity of cells to insulin. Adaptor protein containing pleckstrin homology domain, phosphotyrosine-binding domain, and leucine zipper motif (APPL1) stimulates adiponectin signaling and promotes adiponectin's insulin-sensitizing effects by binding to two adiponectin receptors, AdipoR1 and AdipoR2, and the insulin receptor. In this study, we report an alternative splicing variant of APPL1 (APPL1sv) that is highly expressed in mouse liver, pancreas, and spleen tissues. The expression levels of APPL1sv in liver tissues were enhanced in a mouse model of obesity and diabetic dyslipidemia ( db/db mice) and reduced in calorie-restricted mice compared with -fed mice. APPL1sv overexpression or suppression inhibited or enhanced, respectively, adiponectin-stimulated phosphorylation of AMP protein kinase (AMPK) in mouse hepatocytes. We also found that APPL1sv binds to AdipoR1 and AdipoR2 under basal conditions and that adiponectin treatment reduces this binding. Overexpression of APPL1sv blocked adiponectin-induced interactions of APPL1 with the adiponectin receptors. Moreover, adenovirus-mediated and short hairpin RNA-based suppression of APPL1sv greatly reduced high fat diet-induced insulin resistance and hepatic glucose production in mice. Our study identifies a key suppressor of hepatic adiponectin signaling and insulin sensitivity, a finding that may shed light on identifying effective therapeutic targets for treating insulin resistance and type 2 diabetes.