Recent evidence suggests that progression of insulin resistance parallels progression of atherosclerosis. Fat plays an integral role in the development of type 2 diabetes and vascular injury. The balance of adipose-derived substances, including free fatty acids, tumor necrosis factor-alpha, leptin, adiponectin, and plasminogen activator inhibitor-1, determine both insulin action and the state of vascular inflammation. Peroxisome proliferator-activated receptor-gamma (PPAR-gamma) ligands promote the balance of these substances to enhance insulin-mediated glucose uptake and decrease inflammation. PPAR-gamma ligands reverse the major defect of the insulin resistance syndrome and have important effects that inhibit atherosclerosis, improve endothelial cell function, and attenuate inflammation. Although more research is needed, data suggest that PPAR-gamma ligands may prevent the progression of insulin resistance to diabetes and endothelial dysfunction to atherosclerosis.