Abstract Background In lean healthy human beings, perivascular adipose tissue (PVAT) exerts an anticontractile effect on adjacent small arteries, but this is lost in obesity where there is evidence of adipocyte inflammation and increased oxidative stress. The aim of this study was to investigate the effects of bariatric surgery on small artery function and the underlying mechanisms. Methods Small arteries were isolated from subcutaneous adipose tissue samples obtained by gluteal biopsies from morbidly obese patients (n=15). Vessels were prepared as segments with and without intact PVAT. Response of vessel segments to cumulative doses of norepinephrine was recorded with wire myography. Biopsy samples were re-taken 6 months after bariatric surgery and effect of PVAT on vessel contractility was re-assessed. Vessel segments with intact PVAT were also incubated with blocking peptide for adiponectin receptor 1 (1·6 × 10−4 mol/L, n=5). PVAT adiponectin levels were assessed by proteomic analysis of samples from obese (n=13) and control (n=10) individuals. Inflammatory profile of PVAT was assessed by staining for macrophages and tumour necrosis factor α. Findings Obese patients had a mean body-mass index of 52 kg/m2; 6 months following surgery and significant weight loss (p<0·05), patients remained clinically obese. There were significant improvements in serum biomarkers including adiponectin (p=0·009), as well as inflammatory markers and measures of insulin sensitivity. Proteomic analysis of PVAT showed that adiponectin levels were low in the obese group compared with controls (fold change 2·1, p<0·05). Presence of PVAT made no difference in contractility of vessels to noradrenaline in samples from obese patients (p=0·81). However, post weight loss, PVAT had a significant anticontractile effect (p<0·001) which was lost after incubation with adiponectin receptor 1 blocking peptide. There was a significant reduction in inflammation post surgery. Interpretation Damage to the anticontractile property of PVAT in obesity is in part due to a reduction in adiponectin levels within the PVAT and is rescued by weight loss following bariatric surgery. Funding British Heart Foundation.