Fibroblast growth factor (FGF)21 is an endocrine hormone that is expressed in multiple tissues and functions physiologically to maintain energy homeostasis. FGF21 is being pursued as a therapeutic target for diabetes and obesity because of its rapid and potent effects on improving insulin sensitivity. However, whether FGF21 enhances insulin sensitivity under physiologic conditions remains unclear. Here, we show that liver-derived FGF21 enters the circulation during fasting but also remains present and functional during the early stage of refeeding. After a prolonged fast, FGF21 acts as an insulin sensitizer to overcome the peripheral insulin resistance induced by fasting, thereby maximizing glucose uptake. Likewise, FGF21 is produced from the liver during overfeeding and mitigates peripheral insulin resistance. DIO FGF21 liver-speci fic knockout, but not FGF21 adipose-specific knockout, mice have increased insulin resistance and decreased brown adipose tissue-mediated glucose disposal. These data are compatible with the concept that FGF21 functions physiologically as an insulin sensitizer under conditions of acute refeeding and overfeeding.