Progranulin (PGRN) has recently emerged as an important regulator for glucose metabolism and insulin sensitivity. However, the direct effects of PGRN in vivo and the underlying mechanisms between PGRN and impaired insulin sensitivity are not fully understood. In this study, mice treated with PGRN for 21 d exhibited the impaired glucose tolerance and insulin sensitivity, remarkable ER stress as well as attenuated insulin signaling in liver and adipose tissue but not in skeletal muscle. Furthermore, treatment of mice with phenyl butyric acid (PBA), a chemical chaperone alleviating ER stress, resulted in a significant restoration of systemic insulin sensitivity and recovery of insulin signaling induced by PGRN. Consistent with these findings in vivo, we also observed that PGRN treatment induced ER stress, impaired insulin signaling in cultured hepatocytes and adipocytes, with such effects being partially nullified by blockade of PERK. Whereas PGRN-deficient hepatocytes and adipocytes were more refractory to palmitate-induced insulin resistance, indicating the causative role of the PERK-eIF2a axis of the ER stress response in action of PGRN. Collectively, our findings supported the notion that PGRN is a key regulator of insulin resistance and that PGRN may mediate its effects, at least in part, by inducing ER stress via the PERK-eIF2a dependent pathway.