Low-grade chronic inflammation is a major characteristic of obesity and results from deregulated white adipose tissue function. Consequently, there is interest in identifying the underlying regulatory mechanisms and components that drive adipocyte inflammation. Here, we report that expression of the transcriptional corepressor complex subunits GPS2 and SMRT was significantly reduced in obese adipose tissue, inversely correlated to inflammatory status, and was restored upon gastric bypass surgery-induced weight loss in morbid obesity. These alterations correlated with reduced occupancy of the corepressor complex at inflammatory promoters, providing a mechanistic explanation for elevated inflammatory transcription. In support of these correlations, RNAi-mediated depletion of GPS2 and SMRT from cultured human adipocytes promoted derepression of inflammatory transcription and elevation of obesity-associated inflammatory markers, such as IL-6 and MCP-1. Furthermore, we identified a regulatory cascade containing PPARγ and TWIST1 that controlled the expression of GPS2 and SMRT in human adipocytes. These findings were clinically relevant, because treatment of diabetic obese patients with pioglitazone, an antidiabetic and antiinflammatory PPARγ agonist, restored expression of TWIST1, GPS2, and SMRT in adipose tissue. Collectively, our findings identify alterations in a regulatory transcriptional network in adipocytes involving the dysregulation of a specific corepressor complex as among the initiating events promoting adipose tissue inflammation in human obesity.