Peroxisome proliferator-activated receptor gamma (PPAR-gamma) agonists such as thiazolidinediones (TZDs) improve insulin sensitivity in type 2 diabetes mellitus (T2DM) through effects on fat metabolism whereas GH stimulates lipolysis and induces insulin resistance. To evaluate the impact of TZDs on fat metabolism and insulin sensitivity in subjects exposed to stable GH levels. A randomized, placebo-controlled, double-blind parallel-group study including 20 GH-deficient patients on continued GH replacement therapy. The patients were studied before and after 12 weeks. Patients received either pioglitazone 30 mg (N = 10) or placebo (N = 10) once daily for 12 weeks. Adiponectin levels almost doubled during pioglitazone treatment (P = 0.0001). Pioglitazone significantly decreased basal free fatty acid (FFA) levels (P = 0.02) and lipid oxidation (P = 0.02). Basal glucose oxidation rate (P = 0.004) and insulin sensitivity (P = 0.03) improved in the patients who received pioglitazone treatment. The change in insulin-stimulated adiponectin level after pioglitazone treatment was positively correlated to the change in insulin-stimulated total glucose disposal (R = 0.69, P = 0.04). The impact of GH on lipolysis and insulin sensitivity can be modified by administration of TZDs.