The isomer-specific effects of conjugated linoleic acid (CLA) on hepatic steatosis were assessed in fa/fa Zucker rats, a model for insulin resistance and the metabolic syndrome. Eight weeks of feeding trans-10,cis-12 CLA significantly improved glucose tolerance without changing body weight or visceral adipose mass. The trans-10,cis-12 isomer was also associated with reduced liver lipid content, improved liver function and reduced inflammation; these effects were not observed in rats fed the cis-9,trans-11 CLA isomer. Reduced liver lipid content did not correlate with activation of AMP-activated protein kinase or suppressed activation of sterol-regulatory element binding protein-1, two key regulators of hepatic lipid metabolism. Interestingly, rats fed cis-9,trans-11 CLA had fewer cytoplasmic lipid droplets in hepatocytes compared to rats fed control diet, but these droplets were larger in size. Conversely, fa/fa rats fed the trans-10,cis-12 CLA isomer had greater numbers of hepatic lipid droplets that were smaller in size, resulting in overall lower total lipid within these droplets. Changes in lipid droplets were associated with lower hepatic levels of PERILIPIN-2 (formerly known as adipophilin) in rats fed trans-10,cis-12 CLA, whereas amounts of other members of the PERILIPIN family of lipid droplet proteins were unaffected by dietary CLA. However, CLA isomers differentially affected the subcellular localization of these proteins. Treatment of H4IIE rat hepatoma cells with CLA isomers neither prevented nor reversed, but rather induced cytoplasmic lipid droplet formation, suggesting that the anti-steatotic effects of trans-10,cis-12 CLA are likely indirect and potentially mediated via increased lipid utilization by peripheral tissues.