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Dual peroxisome proliferator-activated receptor (PPAR)α/γ agonists that were developed to target hyperlipidemia and hyperglycemia in type 2 diabetes patients, caused cardiac dysfunction or other adverse effects. We studied the mechanisms that underlie the cardiotoxic effects of a dual PPARα/γ agonist, tesaglitazar, in wild type and diabetic (leptin receptor deficient - db/db) mice. Mice treated with tesaglitazar-containing chow or high fat diet developed cardiac dysfunction despite lower plasma triglycerides and glucose levels. Expression of cardiac peroxisome proliferator-activated receptor gamma coactivator 1-alpha (PGC1α), which promotes mitochondrial biogenesis, had the most profound reduction among various fatty acid metabolism genes. Furthermore, we observed increased acetylation of PGC1α, which suggests PGC1α inhibition and lowered sirtuin 1 (SIRT1) expression. This change was associated with lower mitochondrial abundance. Combined pharmacological activation of PPARα and PPARγ in C57BL/6 mice reproduced the reduction of PGC1α expression and mitochondrial abundance. Resveratrol-mediated SIRT1 activation attenuated tesaglitazar-induced cardiac dysfunction and corrected myocardial mitochondrial respiration in C57BL/6 and diabetic mice but not in cardiomyocyte-specific Sirt1-/- mice. Our data shows that drugs, which activate both PPARα and PPARγ lead to cardiac dysfunction associated with PGC1α suppression and lower mitochondrial abundance likely due to competition between these two transcription factors.