We evaluated the effect of skeletal muscle mitochondrial uncoupling on energy and glucose metabolism under different diets. For 3 mo, transgenic HSA-mUCP1 mice with ectopic expression of uncoupling protein 1 in skeletal muscle and wild-type littermates were fed semisynthetic diets with varying macronutrient ratios (energy % carbohydrate-protein-fat): HCLF (41:42:17), HCHF (41:16:43); LCHF (11:45:44). Body composition, energy metabolism, and insulin resistance were assessed by NMR, indirect calorimetry, and insulin tolerance test, respectively. Gene expression in different organs was determined by real-time PCR. In wild type, both high-fat diets led to an increase in body weight and fat. HSA-mUCP1 mice considerably increased body fat on HCHF but stayed lean on the other diets. Irrespective of differences in body fat content, HSA-mUCP1 mice showed higher insulin sensitivity and decreased plasma insulin and liver triglycerides. Respiratory quotient and gene expression indicated overall increased carbohydrate oxidation of HSA-mUCP1 but a preferential channeling of fatty acids into muscle rather than liver with high-fat diets. Evidence for increased lipogenesis in white fat of HSA-mUCP1 mice suggests increased energy dissipating substrate cycling. Retinol binding protein 4 expression in white fat was increased in HSA-mUCP1 mice despite increased insulin sensitivity, excluding a causal role in the development of insulin resistance. We conclude that skeletal muscle mitochondrial uncoupling does not protect from the development of obesity in all circumstances. Rather it can lead to a "healthy" obese phenotype by preserving insulin sensitivity and a high metabolic flexibility, thus protecting from the development of obesity associated disturbances of glucose homeostasis.