AIMS: Protein kinase C epsilon (PKCε) plays a causative role in the development of glucose intolerance, and is a potential target for the treatment of type 2 diabetes. Here, we examined the effects of the PKCε inhibitor CIDD-0150612 (CP612) on insulin action in palmitate-treated HepG2 hepatocytes in vitro and on glucose homeostasis in fat-fed mice in vivo. METHODS: HepG2 cells were treated with palmitate and CP612 and stimulated with insulin. Insulin signalling was examined by immunoblotting and glucose incorporation into glycogen was measured using glucose tracer. Mice were fed a high-fat diet and treated with CP612 prior to glucose tolerance tests and tissue harvest. Proteomic analysis of liver was carried out by mass spectrometry. RESULTS: CP612 promoted Akt phosphorylation in a highly insulin-dependent manner and reversed the inhibition of insulin-stimulated Akt phosphorylation and glucose incorporation into glycogen by palmitate. Fat-fed mice treated with CP612 had reduced fat mass, but not lean mass, compared with vehicle-treated littermates. Mice treated acutely with CP612 exhibited elevated fasting blood glucose. However, mice studied 24h after the last dose had lower fasting glucose and improved glucose tolerance with a lower insulin excursion. Proteomic analysis of liver from CP612-treated fat-fed mice indicated a reduction in gluconeogenic gene expression and decreased phosphorylation of the transcription factor Foxk1. CONCLUSIONS: The PKCε inhibitor CP612 had beneficial effects on insulin action in hepatocytes and on fat mass and glucose homeostasis in mice. Because certain effects were not previously observed in genetically PKCε-deficient mice, off-target effects may be partly responsible.