Fibroblast growth factor 21 (FGF21) has been identified as a potent metabolic regulator. Administration of recombinant FGF21 protein to rodents and rhesus monkeys with diet-induced or genetic obesity and diabetes exerts strong antihyperglycemic and triglyceride-lowering effects and reduction of body weight. Despite the importance of FGF21 in the regulation of glucose, lipid, and energy homeostasis, the mechanisms by which FGF21 functions as a metabolic regulator remain largely unknown. Here we demonstrate that FGF21 regulates energy homeostasis in adipocytes through activation of AMP-activated protein kinase (AMPK) and sirtuin 1 (SIRT1), resulting in enhanced mitochondrial oxidative function. AMPK phosphorylation levels were increased by FGF21 treatment in adipocytes as well as in white adipose tissue from ob/ob mice. FGF21 treatment increased cellular NAD(+) levels, leading to activation of SIRT1 and deacetylation of its downstream targets, peroxisome proliferator-activated receptor-gamma coactivator-1alpha (PGC-1alpha) and histone 3. Activation of AMPK and SIRT1 by FGF21 in adipocytes enhanced mitochondrial oxidative capacity as demonstrated by increases in oxygen consumption, citrate synthase activity, and induction of key metabolic genes. The effects of FGF21 on mitochondrial function require serine/threonine kinase 11 (STK11/LKB1), which activates AMPK. Inhibition of AMPK, SIRT1, and PGC-1alpha activities attenuated the effects of FGF21 on oxygen consumption and gene expression, indicating that FGF21 regulates mitochondrial activity and enhances oxidative capacity through an AMPK-SIRT1-PGC1alpha-dependent mechanism in adipocytes.