One of the most important characteristics of type 2 diabetes is insulin resistance, during which the patients normally experienced hyperinsulinism stress that would alter insulin signal transduction in insulin target tissues. We have previously found that early growth responsive gene-1 (Egr-1), a zinc finger transcription factor, is highly expressed in db/db mice and in the fat tissue of individuals with type 2 diabetes. In this report, we found that chronic exposure to hyperinsulinism caused persistent Erk/MAPK activity in adipocytes and enhanced insulin resistance in an Egr-1-dependent manner. An elevation in Egr-1 augmented Erk1/2 activation via geranylgeranyl diphosphate synthase (GGPPS). Egr-1-promoted GGPPS transcription increased Ras prenylation and caused Erk1/2 activation. The sustained activation of Erk1/2 resulted in the phosphorylation of insulin receptor substrate-1 at Serine 612. Phosphorylation at this site impaired insulin signaling in adipocytes and reduced glucose uptake. The loss of Egr-1 function, knockdown of GGPPS, or inhibition of Erk1/2 activity in insulin-resistant adipocytes restored insulin receptor substrate-1 tyrosine phosphorylation and increased insulin sensitivity. Our results suggest a new mechanism by which the Egr-1/GGPPS/Erk1/2 pathway is responsible for insulin resistance during hyperinsulinism. This pathway provides a new therapeutic target for increasing insulin sensitivity: inhibiting the function of Egr-1.