Proteins secreted from adipose tissue are increasingly recognized to play an important role in the regulation of glucose metabolism. However, much less is known about their effect on lipid metabolism. The fasting-induced adipose factor (FIAF/angiopoietin-like protein 4/peroxisome proliferator-activated receptor gamma angiopoietin-related protein) was previously identified as a target of hypolipidemic fibrate drugs and insulin-sensitizing thiazolidinediones. Using transgenic mice that mildly overexpress FIAF in peripheral tissues we show that FIAF is an extremely powerful regulator of lipid metabolism and adiposity. FIAF overexpression caused a 50% reduction in adipose tissue weight, partly by stimulating fatty acid oxidation and uncoupling in fat. In addition, FIAF overexpression increased plasma levels of triglycerides, free fatty acids, glycerol, total cholesterol, and high density lipoprotein (HDL)-cholesterol. Functional tests indicated that FIAF overexpression severely impaired plasma triglyceride clearance but had no effect on very low density lipoprotein production. The effects of FIAF overexpression were amplified by a high fat diet, resulting in markedly elevated plasma and liver triglycerides, plasma free fatty acids, and plasma glycerol levels, and impaired glucose tolerance in FIAF transgenic mice fed a high fat diet. Remarkably, in mice the full-length form of FIAF was physically associated with HDL, whereas truncated FIAF was associated with low density lipoprotein. In human both full-length and truncated FIAF were associated with HDL. The composite data suggest that via physical association with plasma lipoproteins, FIAF acts as a powerful signal from fat and other tissues to prevent fat storage and stimulate fat mobilization. Our data indicate that disturbances in FIAF signaling might be involved in dyslipidemia.