The discovery 10 years ago of PGC-1alpha represented a major milestone towards understanding of the molecular processes regulating energy metabolism in many tissues, including skeletal muscle. PGC-1alpha orchestrates a metabolic program regulating oxidative lipid metabolism and insulin sensitivity. This is essentially the same metabolic program that is activated by exercise and down-regulated by sedentary lifestyles and high-fat diets, as well as in cases of obesity and type 2 diabetes. The present review examines the evidence in support of the key role for PGC-1alpha regulation of substrate metabolism and mitochondrial biogenesis in skeletal muscle. Surprisingly, studies with PGC-1alpha null and transgenic mice have revealed unexpected pathologies when PGC-1alpha is completely repressed (KO animals) or is massively overexpressed. In contrast, PGC-1alpha overexpression within normal physiological limits results in marked improvements in fatty acid oxidation and insulin-stimulated glucose transport. Exercise, sedentary lifestyles, and nutritional factors can regulate PGC-1alpha expression. We speculate that optimal targeting of PGC-1alpha upregulation, whether by diet, exercise, or a combination of both, could represent effective prophylactic or therapeutic means to improve insulin sensitivity. Indeed, using modern molecular tools, it may indeed be possible to prescribe optimally individualized nutrition and exercise programs.