Adipogenesis and lipid storage in human adipose tissue are inhibited by androgens such as DHT. Inactivation of DHT to 3α-diol is stimulated by glucocorticoids in human preadipocytes. We sought to characterize glucocorticoid-induced androgen inactivation in human preadipocytes and to establish its role in the antiadipogenic action of DHT. Subcutaneous and omental primary preadipocyte cultures were established from fat samples obtained in subjects undergoing abdominal surgeries. Inactivation of DHT to 3α/β-diol for 24 h was measured in dexamethasone- or vehicle-treated cells. Specific downregulation of aldo-keto reductase 1C (AKR1C) enzymes in human preadipocytes was achieved using RNA interference. In whole adipose tissue sample, cortisol production was positively correlated with androgen inactivation in both subcutaneous and omental adipose tissue (P < 0.05). Maximal dexamethasone (1 μM) stimulation of DHT inactivation was higher in omental compared with subcutaneous fat from men as well as subcutaneous and omental fat from women (P < 0.05). A significant positive correlation was observed between BMI and maximal dexamethasone-induced DHT inactivation rates in subcutaneous and omental adipose tissue of men and women (r = 0.24, n = 26, P < 0.01). siRNA-induced downregulation of AKR1C2, but not AKR1C1 or AKR1C3, significantly reduced basal and glucocorticoid-induced androgen inactivation rates (P < 0.05). The inhibitory action of DHT on preadipocyte differentiation was potentiated following AKR1C2 but not AKR1C1 or AKR1C3 downregulation. Specifically, lipid accumulation, G3PDH activity, and FABP4 mRNA expression in differentiated preadipocytes exposed to DHT were reduced further upon AKR1C2 siRNA transfection. We conclude that glucocorticoid-induced androgen inactivation is mediated by AKR1C2 and is particularly effective in omental preadipocytes of obese men. The interplay between glucocorticoids and AKR1C2-dependent androgen inactivation may locally modulate adipogenesis and lipid accumulation in a depot-specific manner.