Purpose of review: To summarize data that support energy deficit as a signal for inducing improvements in insulin sensitivity following exercise. Recent findings: Insulin sensitivity improves prior to weight loss in diet change protocols and following gastric bypass surgery. Initial changes in insulin sensitivity with weight loss reverse when active weight loss ceases even if total weight loss from baseline persists. Rapid weight loss by liposuction without changes in energy balance does not change insulin sensitivity. Long-term exercise studies (12-14 weeks) on obese men and women demonstrate little improvement in insulin sensitivity when subjects increase caloric intake sufficiently to offset increased energy expenditure and not lose weight. Short-term exercise studies, which control for the confounding impact of chronic training and loss of body fat, suggest that the beneficial effect of exercise on insulin action is reversed when patients consume sufficient calories to offset their physical activity. Very recent data hint that the composition of the refed calories may be a strong determinant of the response. Summary: Energy deficit needs to be present to derive the maximal benefits of exercise on insulin sensitivity. From a public health perspective, exercise programs that do not include decreased caloric intake may have minimal impact on rates of insulin resistance and its health consequences.