H(2)O(2) is a major reactive oxygen species produced by mitochondria that is implicated to be important in aging and pathogenesis of diseases such as diabetes; however, the cellular and physiological roles of mitochondrial H(2)O(2) remain poorly understood. Peroxiredoxin 3 (Prdx3/Prx3) is a thioredoxin peroxidase localized in mitochondria. To understand the cellular and physiological roles of mitochondrial H(2)O(2) in aging and pathogenesis of age-associated diseases, we generated transgenic mice overexpressing Prdx3 (Tg(PRDX3) mice). Tg(PRDX3) mice overexpress Prdx3 in a broad range of tissues, and the Prdx3 overexpression occurs exclusively in the mitochondria. As a result of increased Prdx3 expression, mitochondria from Tg(PRDX3) mice produce significantly reduced amount of H(2)O(2), and cells from Tg(PRDX3) mice have increased resistance to stress-induced cell death and apoptosis. Interestingly, Tg(PRDX3) mice show improved glucose homeostasis, as evidenced by their reduced levels of blood glucose and increased glucose clearance. Tg(PRDX3) mice are also protected against hyperglycemia and glucose intolerance induced by high-fat diet feeding. Our results further show that the inhibition of GSK3 may play a role in mediating the improved glucose tolerance phenotype in Tg(PRDX3) mice. Thus, our results indicate that reduction of mitochondrial H(2)O(2) by overexpressing Prdx3 improves glucose tolerance.