Peroxisome proliferator-activated receptor-γ (PPARγ) is a ligand-activated nuclear receptor which controls lipid and glucose metabolism. It is also the master regulator of adipogenesis. In adipocytes, ligand-dependent PPARγ activation is associated with proteasomal degradation; therefore, regulation of PPARγ degradation may modulate its transcriptional activity. Here, we show that neural precursor cell expressed developmentally down-regulated protein 4 (NEDD4), an E3 ubiquitin ligase, interacts with the hinge and ligand binding domains of PPARγ and is a bona fide E3 ligase for PPARγ. NEDD4 increases PPARγ stability through the inhibition of its proteasomal degradation. Knockdown of NEDD4 in 3T3-L1 adipocytes reduces PPARγ protein levels and suppresses adipocyte conversion. PPARγ correlates positively with NEDD4 in obese adipose tissue. Together, these findings support NEDD4 as a novel regulator of adipogenesis by modulating the stability of PPARγ.