Background. Rodent models suggest that follistatin-like 3 (fstl3) is associated with diabetes and obesity. In humans, plasma fstl3 is reduced with gestational diabetes. In vitro, TNF-α induces fstl3 secretion, which suggests a link to inflammation. Objective. To elucidate the association between plasma fstl3 and obesity, insulin resistance, and low-grade inflammation in humans. Study Design. Plasma fstl3 levels were determined in a cross-sectional study including three groups: patients with type 2 diabetes, impaired glucose tolerance, and healthy controls. In addition, lipopolysaccharide (LPS), TNF-α, or interleukin-6 (IL-6) as well as a hyperinsulinemic euglycemic clamp were used to examine if plasma fstl3 was acutely regulated in humans. Results. Plasma fstl3 was increased in obese subjects independent of glycemic state. Moreover, plasma fstl3 was positively correlated with fat mass, plasma leptin, fasting insulin, and HOMA B and negatively with HOMA S. Furthermore plasma fstl3 correlated positively with plasma TNF-α and IL-6 levels. Infusion of LPS and TNF-α, but not IL-6 and insulin, increased plasma fstl3 in humans. Conclusion. Plasma fstl3 is increased in obese subjects and associated with fat mass and low-grade inflammation. Furthermore, TNF-α increased plasma fstl3, suggesting that TNF-α is one of the inflammatory drivers of increased systemic levels of fstl3.