Cyclic nucleotide phosphodiesterase (PDE) 3B plays an important role in the antilipolytic action of insulin and, thereby, the release of fatty acids from adipocytes. Increased concentrations of circulating fatty acids as a result of elevated or unrestrained lipolysis cause insulin resistance. The lipolytic action of tumor necrosis factor (TNF)-alpha is thought to be one of the mechanisms by which TNF-alpha induces insulin resistance. Ceramide is the suggested second messenger of TNF-alpha action, and in this study, we used 3T3-L1 adipocytes to investigate the effects of C(2)-ceramide (a short-chain ceramide analog) on the expression and regulation of PDE3B and lipolysis. Incubation of adipocytes with 100 micromol/l C(2)-ceramide (N-acetyl-sphingosine) resulted in a time-dependent decrease of PDE3B activity, accompanied by decreased PDE3B protein expression. C(2)-ceramide, in a time- and dose-dependent manner, stimulated lipolysis, an effect that was blocked by H-89, an inhibitor of protein kinase A. These ceramide effects were prevented by 20 micromol/l troglitazone, an antidiabetic drug. In addition to downregulation of PDE3B, the antilipolytic action of insulin was decreased by ceramide treatment. These results, together with data from other studies on PDE3B and lipolysis in diabetic humans and animals, suggest a novel pathway by which ceramide induces insulin resistance. Furthermore, PDE3B is demonstrated to be a target for troglitazone action in adipocytes.