Celastrol is a natural pentacyclic triterpene used in traditional Chinese medicine with significant weight-lowering effects. Celastrol-administered mice at 100 μg/kg decrease food consumption and body weight via a leptin-dependent mechanism, yet its molecular targets in this pathway remain elusive. Here, we demonstrate in vivo that celastrol-induced weight loss is largely mediated by the inhibition of leptin negative regulators protein tyrosine phosphatase (PTP) 1B (PTP1B) and T-cell PTP (TCPTP) in the arcuate nucleus (ARC) of the hypothalamus. We show in vitro that celastrol binds reversibly and inhibits noncompetitively PTP1B and TCPTP. NMR data map the binding site to an allosteric site in the catalytic domain that is in proximity of the active site. By using a panel of PTPs implicated in hypothalamic leptin signaling, we show that celastrol additionally inhibited PTEN and SHP2 but had no activity toward other phosphatases of the PTP family. These results suggest that PTP1B and TCPTP in the ARC are essential for celastrol's weight lowering effects in adult obese mice.