Objective Adipose inflammation and dysfunction underlie metabolic obesity. Exercise improves glycemic control and metabolic indices, but effects on adipose function and inflammation are less clear. Accordingly, it was hypothesized that exercise improves adipose morphometry to reduce adipose inflammation in hyperphagic obese mice. Methods Alms1 mutant foz/foz mice housed in pairs were fed an atherogenic or chow diet; half the cages were fitted with a computer-monitored wheel for voluntary exercise. Insulin-induced AKT-phosphorylation, adipocyte size distribution, and inflammatory recruitment were studied in visceral versus subcutaneous depots, and severity of fatty liver disease was determined. Results Exercise prevented obesity and diabetes development in chow-fed foz/foz mice and delayed their onset in atherogenic-fed counterparts. Insulin-stimulated phospho-AKT levels in muscle were improved with exercise, but not in adipose or liver. Exercise suppressed adipose inflammatory recruitment, particularly in visceral adipose, associated with an increased number of small adipocyte subpopulations, and enhanced expression of beige adipocyte factor PRDM16 in subcutaneous fat. In atherogenic-fed foz/foz mice liver, exercise suppressed development of nonalcoholic steatohepatitis and related liver fibrosis. Conclusions Exercise confers metabo-protective effects in atherogenic-fed hyperphagic mice by preventing early onset of obesity and diabetes in association with enhanced muscle insulin sensitivity, improved adipose morphometry, and suppressed adipose and liver inflammation.