Intramyocellular triglyceride (IMTG) correlates with insulin resistance, but there is no clear causal relationship. Insulin resistance and associated hyperinsulinaemia may increase IMTG, via the insulin-regulated transcription factor, sterol regulatory element-binding protein 1 (SREBP-1). PPAR agonists may also affect IMTG via changes in insulin sensitivity, SREBP-1 or other factors. We examined skeletal muscle IMTG and SREBP-1 expression, and metabolic parameters in Zucker diabetic fatty rats (ZDF) after 25 weeks of PPAR-gamma or PPAR-alpha administration. Compared with Zucker lean rats (ZL), untreated ZDF had significantly higher weights, serum glucose, insulin, free fatty acids, total cholesterol and triglycerides. IMTG and SREBP-1c messenger RNA (mRNA) were also higher in untreated ZDF; both were decreased by fenofibrate (FF). Rosiglitazone (Rosi), despite marked improvement in glycaemia, hyperinsulinaemia and hyperlipidaemia, failed to affect SREBP-1 expression, and increased body weight and IMTG. Rosi/FF combination caused less weight gain and no IMTG increase, despite metabolic effects similar to Rosi alone. IMTG and SREBP-1c mRNA are high in the ZDF. FF and Rosi both improved insulin sensitivity but had opposite effects on IMTG. Thus, there was a clear discordance between insulin sensitivity and IMTG with PPAR agonists, indicating that IMTG and insulin sensitivity do not share a simple relationship.