Circulating branched-chain amino acids (BCAAs) associate with insulin resistance and type 2 diabetes. 3-Hydroxyisobutyrate (3-HIB) is a catabolic intermediate of the BCAA valine. In this study, we show that in a cohort of 4,942 men and women, circulating 3-HIB is elevated according to levels of hyperglycemia and established type 2 diabetes. In complementary cohorts with measures of insulin resistance, we found positive correlates for circulating 3-HIB concentrations with HOMA2 of insulin resistance, as well as a transient increase in 3-HIB followed by a marked decrease after bariatric surgery and weight loss. During differentiation, both white and brown adipocytes upregulate BCAA utilization and release increasing amounts of 3-HIB. Knockdown of the 3-HIB–forming enzyme 3-hydroxyisobutyryl-CoA hydrolase decreases release of 3-HIB and lipid accumulation in both cell types. Conversely, addition of 3-HIB to white and brown adipocyte cultures increases fatty acid uptake and modulated insulin-stimulated glucose uptake in a time-dependent manner. Finally, 3-HIB treatment decreases mitochondrial oxygen consumption and generation of reactive oxygen species in white adipocytes, while increasing these measures in brown adipocytes. Our data establish 3-HIB as a novel adipocyte-derived regulator of adipocyte subtype-specific functions strongly linked to obesity, insulin resistance, and type 2 diabetes.