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Saroglitazar is a dual PPAR-α/γ agonist approved for the treatment of diabetic dyslipidemia. In addition to reduction in atherogenic lipids, it may also contribute to improvement in insulin sensitivity through PPAR-α/γ agonism, which remains unexplored. We conducted a randomized, double-blind, placebo-controlled trial in treatment-naive T2DM individuals with serum triglyceride >150 mg/dL. Participants were randomized to receive either saroglitazar 4 mg or placebo (1:1) daily for 4 months (n = 30). Insulin sensitivity (SIclamp) was studied using hyperinsulinemic-euglycemic clamp at baseline and at 4 months. We observed a significant reduction in TG (p = 0.001), HbA1c (p = 0.019) and fasting plasma glucose (p = 0.019) and significant increase in HDL-C levels (p < 0.01) with saroglitazar compared to placebo. Further, patients on saroglitazar had a greater improvement in SIclamp (p = 0.026) with the effect persisting despite adjusting for baseline weight, TG, HDL-C and HbA1c (p = 0.002). This was accompanied with significant increase in HOMA-β (p = 0.01) in the saroglitazar group and change in HOMA-β showed a trend towards significance with SIclamp (r = 0.503, p = 0.056). However, change in SIclamp did not significantly correlate with reduction in HbA1c and TG. We conclude that saroglitazar effectively reduces hypertriglyceridemia and improves insulin sensitivity along with β-cell function by reduction in gluco-lipotoxicity and possibly directly through PPAR-γ agonism in patients ofT2DM with hypertriglyceridemia. [ABSTRACT FROM AUTHOR]