Peroxisome proliferator-activated receptor gamma (PPARgamma) agonists demonstrate antitumor activity likely through transactivating genes that regulate cell proliferation, apoptosis, and differentiation. The PAX8/PPARgamma fusion oncogene, which is common in human follicular thyroid carcinomas appears to act via dominant negative suppression of wild-type PPARgamma, suggesting that it may be a tumor suppressor gene in thyroid cells. We have identified a novel high-affinity PPARgamma agonist (RS5444) that is dependent upon PPARgamma for its biological activity. This is the first report of this molecule and its antitumor activity. In vitro, the IC50 for growth inhibition is approximately 0.8 nM while anaplastic thyroid carcinoma (ATC) tumor growth was inhibited three- to fourfold in nude mice. siRNA against PPARgamma and a pharmacological antagonist demonstrated that functional PPARgamma was required for growth inhibitory activity of RS5444. RS5444 upregulated the cell cycle kinase inhibitor, p21WAF1/CIP1. Silencing p21WAF1/CIP1 rendered cells insensitive to RS5444. RS5444 plus paclitaxel demonstrated additive antiproliferative activity in cell culture and minimal ATC tumor growth in vivo. RS5444 did not induce apoptosis but combined with paclitaxel, doubled the apoptotic index compared to that of paclitaxel. Our data indicate that functional PPARgamma is a molecular target for therapy in ATC. We demonstrated that RS5444, a thiazolidinedione (Tzd) derivative, alone or in combination with paclitaxel, may provide therapeutic benefit to patients diagnosed with ATC.