Abstract Abstract Adipose differentiation is a complex process controlled by a network of transcription factors and co-regulators. We compared the global gene expression patterns of adipogenic and non-adipogenic clones of 3T3-F442A pre-adipocytes and identified the transcriptional co-factor, Vestigial-like 3 (Vgll3), as an inhibitor of adipogenesis. Vgll3 expression is down-regulated during terminal adipocyte differentiation in vitro and negatively correlates with weight and total fat mass in vivo. Furthermore, enforced expression of Vgll3 expression inhibits the differentiation of pre-adipocytes in vitro, whereas shRNA-mediated knockdown of Vgll3 expression promotes differentiation. Interestingly, expression of Vgll3 promoted the expression of genes associated with bone and chondrocyte formation, suggesting that Vgll3 participates in the decision of mesenchymal cells to proceed down the adipocyte, bone or cartilage lineages. Ultimately, the elucidation of factors involved in specification of the adipocyte phenotype may aid in the identification of new strategies for the treatment of metabolic disease.