Weight loss (WL) by hypocaloric diet decreases adipocyte lipolysis and fat oxidation, adaptations that might predispose individuals to regain weight. Our hypothesis was that the addition of endurance exercise (EX) to dietary-induced WL (6 mo; 250-350 kcal/day deficit) would prevent declines in abdominal (ABD) and gluteal (GLT) adipocyte lipolysis and fat oxidation in obese older women. At baseline, the WL (n = 9) and WL+EX (n = 11) groups had similar body composition, fat distribution, aerobic fitness (VO2max), and resting fat metabolism. Reductions in body weight (WL = 11%, WL+EX = 8%), percent body fat, and intra-abdominal fat area with the interventions were similar in both groups, but VO2max increased (9%, P < 0.01) only in the WL+EX group. Basal and adrenergic receptor- and postreceptor-stimulated lipolysis in ABD and GLT adipocytes decreased (20-70%, P < 0.05) in the WL group but did not change in the WL+EX group. Fat oxidation decreased (38%, P < 0.05) in the WL group but not in the WL+EX group. The changes in fat oxidation and GLT lipolysis differed significantly between groups. Fat oxidation correlated positively with ABD and GLT adipocyte basal lipolysis at baseline (r = 0.45 and r = 0.53, P < 0.05), and the changes in fat oxidation with the interventions correlated positively with changes in ABD and GLT adipocyte basal lipolysis (r = 0.50 and r = 0.42. P < 0.05) in the entire group of women. These results indicate that exercise counteracts the decline in fat oxidation with WL, in part by maintaining adipocyte lipolytic responsiveness in some weight-reduced postmenopausal women.