Despite being the frontline therapy for type 2 diabetes, the mechanisms of action of the biguanide drug metformin are still being discovered. In particular, the detailed molecular interplays between the AMPK and the mTORC1 pathway in the hepatic benefits of metformin are still ill defined. Metformin-dependent activation of AMPK classically inhibits mTORC1 via TSC/RHEB, but several lines of evidence suggest additional mechanisms at play in metformin inhibition of mTORC1. Here we investigated the role of direct AMPK-mediated serine phosphorylation of RAPTOR in a new Raptor^AA mouse model, in which AMPK phospho-serine sites Ser722 and Ser792 of RAPTOR were mutated to alanine. Metformin treatment of primary hepatocytes and intact murine liver requires AMPK regulation of both RAPTOR and TSC2 to fully inhibit mTORC1, and this regulation is critical for both the translational and transcriptional response to metformin. Transcriptionally, AMPK and mTORC1 were both important for regulation of anabolic metabolism and inflammatory programs triggered by metformin treatment. The hepatic transcriptional response in mice on high-fat diet treated with metformin was largely ablated by AMPK deficiency under the conditions examined, indicating the essential role of this kinase and its targets in metformin action in vivo.