The nuclear receptor corepressors NCoR and SMRT repress gene transcription by recruiting a histone deacetylase complex. Their roles in PPARgamma action have been controversial. Recent evidence, however, suggests that NCoR and SMRT repress PPARgamma-mediated transcriptional activity on specific promoters in the adipocyte. In addition, by repressing PPARgamma action, these corepressors inhibit the ability of adipocyte differentiation to proceed. A further understanding of corepressor action in the adipocyte will provide insight into the balance of forces regulating adipogenesis, insulin sensitivity, and Type 2 diabetes mellitus.