Our understanding of the processes that lead to adipocyte differentiation has been greatly enhanced in the past few years by researchers' unraveling of the key molecular events in adipogenesis. Adipocyte differentiation is controlled by a transcriptional cascade, a master regulator of which is PPARγ, a member of the nuclear hormone receptor superfamily of transcription factors. This review examines the mechanisms involved in the regulation of PPARγ's adipogenic potential, the role of key molecules involved in adipogenesis, like C/EBP's and ADD1, and their relationship with PPARγ