Preadipocyte factor 1 (Pref-1) belongs to the Notch/Delta/Serrate family of epidermal growth factor-like repeat-containing proteins. Pref-1 is highly expressed in 3T3-L1 cells but is extinguished during adipocyte differentiation. Pref-1 serves as an excellent marker for preadipocytes. Furthermore, Pref-1 is an inhibitor of adipogenesis. Constitutive expression of Pref-1 inhibits, whereas antisense Pref-1 enhances, 3T3-L1 adipocyte differentiation. We found that Pref-1 is synthesized as a transmembrane protein but processed to generate soluble forms, including a large 50-kDa soluble form and the small soluble forms. Furthermore, only the large soluble form, but not the small soluble or the transmembrane forms of Pref-1, is biologically active to inhibit adipogenesis. We recently elucidated that the 50-kDa soluble form of Pref-1 is released by an ADAM family member, tumor necrosis factor-alpha converting enzyme (ADMA 17). In vivo, mice lacking Pref-1 show accelerated fat deposition; conversely, mice overexpressing soluble Pref-1 in adipose tissue show a decrease in fat mass, reduced expression of adipocyte markers, and lower adipocyte-secreted factors. These findings clearly demonstrate the inhibitory effect of Pref-1 on adipogenesis in vivo.