Saturated free fatty acids have been implicated in the increase of oxidative stress, mitochondrial dysfunction, apoptosis, and insulin resistance seen in type 2 diabetes. The purpose of this study was to determine whether palmitate-induced mitochondrial DNA (mtDNA) damage contributed to increased oxidative stress, mitochondrial dysfunction, apoptosis, impaired insulin signaling, and reduced glucose uptake in skeletal muscle cells. Adenoviral vectors were used to deliver the DNA repair enzyme human 8-oxoguanine DNA glycosylase/(apurinic/apyrimidinic) lyase (hOGG1) to mitochondria in L6 myotubes. After palmitate exposure, we evaluated mtDNA damage, mitochondrial function, production of mitochondrial reactive oxygen species, apoptosis, insulin signaling pathways, and glucose uptake. Protection of mtDNA from palmitate-induced damage by overexpression of hOGG1 targeted to mitochondria significantly diminished palmitate-induced mitochondrial superoxide production, restored the decline in ATP levels, reduced activation of c-Jun N-terminal kinase (JNK) kinase, prevented cells from entering apoptosis, increased insulin-stimulated phosphorylation of serine-threonine kinase (Akt) (Ser473) and tyrosine phosphorylation of insulin receptor substrate-1, and thereby enhanced glucose transporter 4 translocation to plasma membrane, and restored insulin signaling. Addition of a specific inhibitor of JNK mimicked the effect of mitochondrial overexpression of hOGG1 and partially restored insulin sensitivity, thus confirming the involvement of mtDNA damage and subsequent increase of oxidative stress and JNK activation in insulin signaling in L6 myotubes. Our results are the first to report that mtDNA damage is the proximal cause in palmitate-induced mitochondrial dysfunction and impaired insulin signaling and provide strong evidence that targeting DNA repair enzymes into mitochondria in skeletal muscles could be a potential therapeutic treatment for insulin resistance.