BACKGROUND: Pancreatic polypeptide (PP) is a potent anti-obesity agent known to inhibit food intake in the absence of nausea, but the mechanism behind this process is unknown. METHODOLOGY/PRINCIPAL FINDINGS: Here we demonstrate that in response to i.p. injection of PP in wild type but not in Y4 receptor knockout mice, immunostaining for the neuronal activation marker c-Fos is induced specifically in neurons of the nucleus tractus solitarius and the area postrema in the brainstem, notably in cells also showing immunostaining for tyrosine hydroxylase. Importantly, strong c-Fos activation is also detected in the arcuate nucleus of the hypothalamus (ARC), particularly in neurons that co-express alpha melanocyte stimulating hormone (alpha-MSH), the anorexigenic product of the proopiomelanocortin (POMC) gene. Interestingly, other hypothalamic regions such as the paraventricular nucleus, the ventromedial nucleus and the lateral hypothalamic area also show c-Fos induction after PP injection. In addition to c-Fos activation, PP injection up-regulates POMC mRNA expression in the ARC as detected by in situ hybridization. These effects are a direct consequence of local Y4 signaling, since hypothalamus-specific conditional Y4 receptor knockout abolishes PP-induced ARC c-Fos activation and blocks the PP-induced increase in POMC mRNA expression. Additionally, the hypophagic effect of i.p. PP seen in wild type mice is completely absent in melanocortin 4 receptor knockout mice. CONCLUSIONS/SIGNIFICANCE: Taken together, these findings show that PP reduces food intake predominantly via stimulation of the anorexigenic alpha-MSH signaling pathway, and that this effect is mediated by direct action on local Y4 receptors within the ARC, highlighting a potential novel avenue for the treatment of obesity.