The gut-derived hormone, peptide YY (PYY) reduces food intake and enhances satiety in both humans and animals. Obese individuals also have a deficiency in circulating peptide YY, although whether this is a cause or a consequence of obesity is unclear. Our aims were to determine whether peptide YY (PYY) over-expression may have therapeutic effects for the treatment of obesity by altering energy balance and glucose homeostasis. We generated PYY transgenic mice and measured body weight, food intake, temperature, adiposity, glucose tolerance, circulating hormone and lipid concentrations and hypothalamic neuropeptide levels (neuropeptide Y; proopiomelanocortin, and thyrotropin-releasing hormone) under chow and high-fat feeding and after crossing these mice onto the genetically obese leptin-deficient ob/ob mouse background. PYY transgenic mice were protected against diet-induced obesity in association with increased body temperature (indicative of increased thermogenesis) and sustained expression of thyrotropin-releasing hormone in the paraventricular nucleus of the hypothalamus. Moreover, PYY transgenic mice crossed onto the genetically obese ob/ob background had significantly decreased weight gain and adiposity, reduced serum triglyceride levels and improved glucose tolerance compared to ob/ob controls. There was no effect of PYY transgenic over expression on basal or fasting-induced food intake measured at 11-12 weeks of age. Together, these findings suggest that long-term administration of PYY, PYY-like compounds or agents that stimulate PYY synthesis in vivo can reduce excess adiposity and improve glucose tolerance, possibly via effects on the hypothalamo-pituitary-thyroid axis and thermogenesis.