We describe a metabolic disorder characterized by lipodystrophy, hepatic steatosis, insulin resistance, severe diabetes, and growth retardation observed in mice carrying N-ethyl-N-nitrosourea (ENU)-induced mutations. The disorder was ascribed to a mutation of kelch repeat and BTB (POZ) domain containing 2 (Kbtbd2) and was mimicked by a CRISPR/Cas9-targeted null allele of the same gene. Kbtbd2 encodes a BTB-Kelch family substrate recognition subunit of the Cullin-3-based E3 ubiquitin ligase. KBTBD2 targeted p85α, the regulatory subunit of the phosphoinositol-3-kinase (PI3K) heterodimer, causing p85α ubiquitination and proteasomemediated degradation. In the absence of KBTBD2, p85α accumulated to 30-fold greater levels than in wild-type adipocytes, and excessive p110-free p85α blocked the binding of p85α-p110 heterodimers to IRS1, interrupting the insulin signal. Both transplantation of wild-type adipose tissue and homozygous germ line inactivation of the p85α-encoding gene Pik3r1 rescued diabetes and hepatic steatosis phenotypes of Kbtbd2 −/− mice. Kbtbd2 was down-regulated in diet-induced obese insulin-resistant mice in a leptin-dependent manner. KBTBD2 is an essential regulator of the insulin-signaling pathway, modulating insulin sensitivity by limiting p85α abundance.diabetes | insulin resistance | Kbtbd2 | p85α | ubiquitination