Agonists of peroxisome proliferator-activated receptor gamma (PPARgamma) are a new class of oral drugs designed to treat insulin-resistant diabetes (i.e., type 2 diabetes). However, troglitazone, the first compound in the class approved by the US Food and Drug Administration (FDA) in 1997 was found to be hepatotoxic and was withdrawn from the market after reports of severe liver failure. The mechanism of PPAR gamma agonist-induced hepatotoxicity remains unknown. In this study, we examined the hepatotoxic effects of five PPAR gamma agonists (ciglitazone, pioglitazone, rosiglitazone, troglitazone, and JTT-501) on rat primary hepatocytes and human HepG2 cells. We also compared the gene expression profiles of rat primary hepatocytes after exposure to PPAR gamma agonists by using the Rat Genome Survey Microarray system from Applied Biosystems in order to understand the mechanisms of hepatotoxicities induced by PPARgamma agonists. Consistent with the hepatotoxicity data, our results demonstrate that the gene expression profiles affected by troglitazone and ciglitazone can be clearly distinguished from those by pioglitazone and rosiglitazone. Genes that are differentially expressed between the more toxic troglitazone/ciglitazone group and the less toxic rosiglitazone/pioglitazone group are involved in necrotic, apoptotic, and cell proliferative pathways. The five compounds were also clustered based on a set of molecular descriptors. The clustering based on chemical structural information is in good agreement with the clustering of compounds based on cytotoxicity or gene expression data, indicating a strong relationship between chemical structure and biological endpoints. Our work suggests that microarray analysis together with toxicological observations can be used to rank drugs for hepatotoxicity and to evaluate the safety of new compounds.