AIM: To examine factors underlying why most, but not all, adults with obesity exhibit impaired insulin-mediated glucose uptake, we compared: (1) adipose tissue fatty acid (FA) release, (2) skeletal muscle lipid droplet (LD) characteristics, and (3) insulin signalling events, in skeletal muscle of adults with obesity with relatively high versus low insulin-mediated glucose uptake. METHODS: Seventeen adults with obesity (BMI: 36 ± 3 kg/m(2)) completed a 2 h hyperinsulinemic-euglycemic clamp with stable isotope tracer infusions to measure glucose rate of disappearance (glucose Rd) and FA rate of appearance (FA Ra). Skeletal muscle biopsies were collected at baseline and 30 min into the insulin infusion. Participants were stratified into HIGH (n = 7) and LOW (n = 10) insulin sensitivity cohorts by their glucose Rd during the hyperinsulinemic clamp (LOW< 400; HIGH >550 nmol/kgFFM/min/[μU/mL]). RESULTS: Insulin-mediated suppression of FA Ra was lower in LOW compared with HIGH (p < 0.01). In skeletal muscle, total intramyocellular lipid content did not differ between cohorts. However, the size of LDs in the subsarcolemmal region (SS) of type II muscle fibres was larger in LOW compared with HIGH (p = 0.01). Additionally, insulin receptor-β (IRβ) interactions with regulatory proteins CD36 and Fyn were lower in LOW versus HIGH (p < 0.01), which aligned with attenuated insulin-mediated Tyr phosphorylation of IRβ and downstream insulin-signalling proteins in LOW. CONCLUSION: Collectively, reduced ability for insulin to suppress FA mobilization, with accompanying modifications in intramyocellular LD size and distribution, and diminished IRβ interaction with key regulatory proteins may be key contributors to impaired insulin-mediated glucose uptake commonly found in adults with obesity.