We previously reported that insulin receptor substrate-2 (IRS-2)-deficient mice develop diabetes as a result of insulin resistance in the liver and failure of beta-cell hyperplasia. In this study we introduced the IRS-2 gene specifically into the liver of Irs2(-/-) mice with adenovirus vectors. Glucose tolerance tests revealed that the IRS-2 restoration in the liver ameliorated the hyperglycemia, but the improvement in hyperinsulinemia was only partial. Endogenous glucose production (EGP) and the rate of glucose disappearance (Rd) were measured during hyperinsulinemic-euglycemic clamp studies: EGP was increased 2-fold in the Irs2(-/-) mice, while Rd decreased by 50%. Restoration of IRS-2 in the liver suppressed EGP to a level similar to that in wild-type mice, but Rd remained decreased in the Adeno-IRS-2-infected Irs2(-/-) mice. Irs2(-/-) mice also exhibit obesity and hyperleptinemia associated with impairment of hypothalamic phosphatidylinositol 3-kinase activation. Continuous intracerebroventricular leptin infusion or caloric restriction yielded Irs2(-/-) mice whose adiposity was comparable to that of Irs2(+/+) mice, and both the hyperglycemia and the hyperinsulinemia of these mice improved with increased Rd albeit partially. Finally combination treatment consisting of adenovirus-mediated gene transfer of IRS-2 and continuous intracerebroventricular leptin infusion completely reversed the hyperglycemia and hyperinsulinemia in Irs2(-/-) mice. EGP and Rd also became normal in these mice as well as in mice treated by caloric restriction plus adenoviral gene transfer. We therefore concluded that a combination of increased EGP due to insulin signaling defects in the liver and reduced Rd due to obesity accounts for the systemic insulin resistance in Irs2(-/-) mice.