PGC-1␣ overexpression in skeletal muscle, in vivo, has yielded disappointing and unexpected effects, including disrupted cellular integrity and insulin resistance. These unanticipated results may stem from an excessive PGC-1␣ overexpression in transgenic animals. Therefore, we examined the effects of a modest PGC-1␣ overexpression in a single rat muscle, in vivo, on fuel-handling proteins and insulin sensitivity. We also examined whether modest PGC-1␣ overexpression selectively targeted subsarcolemmal (SS) mitochondrial proteins and fatty acid oxidation, because SS mitochondria are metabolically more plastic than intermyofibrillar (IMF) mitochondria. Among metabolically heterogeneous rat hindlimb muscles, PGC-1␣ was highly correlated with their oxidative fiber content and with substrate transport proteins (GLUT4, FABPpm, and FAT/ CD36) and mitochondrial proteins (COXIV and mTFA) but not with insulin-signaling proteins (phosphatidylinositol 3-kinase, IRS-1, and Akt2), nor with 5-AMP-activated protein kinase, ␣2 subunit, and HSL. Transfection of PGC-1␣ into the red (RTA) and white tibialis anterior (WTA) compartments of the tibialis anterior muscle increased PGC-1␣ protein by 23-25%. This also induced the up-regulation of transport proteins (FAT/CD36, 35-195%; GLUT4, 20 -32%) and 5-AMP-activated protein kinase, ␣2 subunit (37-48%), but not other proteins (FABPpm, IRS-1, phosphatidylinositol 3-kinase, Akt2, and HSL). SS and IMF mitochondrial proteins were also up-regulated, including COXIV (15-75%), FAT/CD36 (17-30%), and mTFA (15-85%). PGC-1␣ overexpression also increased palmitate oxidation in SS (RTA, ؉116%; WTA, ؉40%) but not in IMF mitochondria, and increased insulin-stimulated phosphorylation of AKT2 (28 -43%) and rates of glucose transport (RTA, ؉20%; WTA, ؉38%). Thus, in skeletal muscle in vivo, a modest PGC-1␣ overexpression up-regulated selected plasmalemmal and mitochondrial fuel-handling proteins, increased SS (not IMF) mitochondrial fatty acid oxidation, and improved insulin sensitivity.