Oxidative stress plays an important role in the pathogenesis of insulin resistance and type 2 diabetes mellitus and in diabetic vascular complications. Thiazolidinediones (TZDs), a class of peroxisome proliferatoractivated receptor ␥ (PPAR␥) agonists, improve insulin sensitivity and are currently used for the treatment of type 2 diabetes mellitus. Here, we show that TZD prevents oxidative stress-induced insulin resistance in human skeletal muscle cells, as indicated by the increase in insulin-stimulated glucose uptake and insulin signaling. Importantly, TZD-mediated activation of PPAR␥ induces gene expression of glutathione peroxidase 3 (GPx3), which reduces extracellular H 2 O 2 levels causing insulin resistance in skeletal muscle cells. Inhibition of GPx3 expression prevents the antioxidant effects of TZDs on insulin action in oxidative stress-induced insulinresistant cells, suggesting that GPx3 is required for the regulation of PPAR␥-mediated antioxidant effects. Furthermore, reduced plasma GPx3 levels were found in patients with type 2 diabetes mellitus and in db/db/DIO mice. Collectively, these results suggest that the antioxidant effect of PPAR␥ is exclusively mediated by GPx3 and further imply that GPx3 may be a therapeutic target for insulin resistance and diabetes mellitus.