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Obesity is a complex multifactorial disease. Adipocytes arise from pluripotent mesenchymal stem cells (MSC), which are also capable of differentiation into bone, muscle, or cartilage. Adipogenesis involves lineage commitment, mitotic clonal expansion, and terminal differentiation. Understanding these mechanisms, as well as when and how to turn them on or off, may allow development of new therapeutic approaches to obesity, diabetes, and cardiovascular disease. The most abundant non-lipid component of olive plant is the polyphenol oleuropein (Ole). We found that Ole modulates adipocyte differentiation, fat accumulation and adipogenic gene expression in human MSCs (hMSC). Ole blocks adipogenesis in a dose-dependent manner. Using RT-PCR to monitor gene expression, we found that Ole down-regulates the expression of adipogenic genes PPARγ2, LPL (lipoprotein lipase), and aP2 (lipid binding protein), while it upregulates PPARδ expression. In addition, in the presence of Ole, we were able to achieve transdifferentiation and dedifferentiation, allowing fat cells to assume other fates. These results demonstrate the potential utility of Ole for the treatment of obesity, diabetes, and related disorders, which are associated with increased fat mass. Because it modulates adipocyte differentaion, Ole may also be useful for the treatment of cachexia and lipodystrophy.