In lipoatrophic and obese humans, reduced expression of PLIN1, CIDEC, or CIDEA in adipocytes results in constitutive release of fatty acids (FA). These fatty acids act locally and enter the bloodstream, where they activate inflammatory pathways, promote ectopic lipid deposition in peripheral tissues, and cause insulin resistance. The released fatty acids act locally to promote insulin resistance and inflammation by: (a) engaging TLRs, resulting in activation of MAPK signaling pathways and release of inflammatory mediators, which block insulin actions on lipolysis and glucose uptake; (b) recruiting macrophages that amplify the inflammatory response; and (c) inducing ectopic lipid deposition in hepatocytes and skeletal muscle cells and activating inflammatory pathways. A reduction in PLIN1 increases constitutive lipolysis by allowing CGI-58, normally associated with PLIN1, to activate LD-associated and non-LD–associated ATGL. Reductions in CIDEA or CIDEC enhance lipolysis by unclear mechanisms. In humans, genetic alterations in seipin and caveolin-1 reduce adipose tissue mass, resulting in lipodystrophy.