Insulin resistance in adipose tissue in human obesity is associated with increased protein-tyrosine phosphatase (PTPase) activity and elevated levels of the PTPases leukocyte common antigen-related PTPase (LAR) and PTP1B. To determine whether the improved insulin sensitivity associated with weight loss in obese subjects is accompanied by reversible changes in PTPases, we obtained subcutaneous adipose tissue from seven obese subjects (mean body mass index [BMI], 40.4 kg/m²) before and after a loss of 10% of body weight and again after a 4-week maintenance period. Weight loss was accompanied by an 18.5% decrease in overall adipose tissue PTPase activity (P = .015) that was further reduced to 22.3% of the control value (P = .005) at the end of the maintenance period. By immunoblot analysis, the abundance of LAR was decreased by 21% (P = .04) and abundance of PTP1B was decreased by 40% (P < .004) after the initial weight loss, and the decreases persisted during the maintenance period. Enhanced insulin sensitivity following weight loss, evident from a 26% decrease in fasting insulin levels (P < .05), was also closely correlated with the reduction in the abundance of both LAR (R² = .80, P < .01) and PTP1B (R² = .64, P = .03). These results support the hypothesis that LAR and PTP1B may be reversibly involved in the pathogenesis of insulin resistance, and may be therapeutic targets in insulin-resistant states.