Erythropoietin has shown beneficial effects in the regulation of obesity and metabolic syndrome. We created the mice with adipocyte specific deletion of erythropoietin receptor. These mice exhibited obesity and decreased glucose tolerance and insulin sensitivity especially on high fat diet. Erythropoietin treatment in wild type mice subjected to diet induced obesity increased oxidative metabolism, fatty acid oxidation and key metabolic genes in adipocytes as well as in white adipose tissue from diet induced obese wild type mice. Erythropoietin induced increase in metabolic activity is associated with induction of brown fat like features in white adipocytes as demonstrated by increases in brown fat gene expression, mitochondrial content and uncoupled respiration. PPARalpha was found to mediate erythropoietin activity. PPARalpha cooperates with Sirt1 activated by erythropoietin through modulating NAD+ level to regulate metabolic activity and Sirt1 knock down also attenuated adipose response to erythropoietin. These findings suggest erythropoietin signaling may provide a potential therapeutic strategy to protect against obesity and metabolic disorders.