The aims of the present study were to evaluate the expression of prolyl 4-hydroxylase subunit alpha 3 (P4HA3) in adipocytes and adipose tissue and to explore its effect on obesity and type 2 diabetes mellitus (T2DM). We initially demonstrated that P4HA3 was significantly upregulated in the subcutaneous adipose tissue of obesity and T2DM patients, and its functional roles in adipocyte differentiation and insulin resistance were investigated using in vitro and in vivo models. The knockdown of P4HA3 inhibited adipocyte differentiation and improved insulin resistance in 3T3-L1 cells. In C57BL/6J db/db mice fed with a high fat diet (HFD), silencing P4HA3 significantly decreased fasting blood glucose and triglycerides (TG) levels, with concomitant decrease of body weight and adipose tissue weight. Further analysis showed that P4HA3 knockdown was correlated with the augmented IRS-1/PI3K/Akt/FoxO1 signaling pathway in the adipose and hepatic tissues of obese mice, which could improve hepatic glucose homeostasis and steatosis of mice. Together, our study suggested that the dysregulation of P4HA3 may contribute to the development of obesity and T2DM.