Excess lipid availability causes insulin resistance. We examined the effect of acute exercise on lipid-induced insulin resistance and TBC1 domain family member 1/4 (TBCD1/4)-related signaling in skeletal muscle. In eight healthy young male subjects, 1 h of one-legged knee-extensor exercise was followed by 7 h of saline or intralipid infusion. During the last 2 h, a hyperinsulinemic-euglycemic clamp was performed. Femoral catheterization and analysis of biopsy specimens enabled measurements of leg substrate balance and muscle signaling. Each subject underwent two experimental trials, differing only by saline or intralipid infusion. Glucose infusion rate and leg glucose uptake was decreased by intralipid. Insulin-stimulated glucose uptake was higher in the prior exercised leg in the saline and the lipid trials. In the lipid trial, prior exercise normalized insulin-stimulated glucose uptake to the level observed in the resting control leg in the saline trial. Insulin increased phosphorylation of TBC1D1/4. Whereas prior exercise enhanced TBC1D4 phosphorylation on all investigated sites compared with the rested leg, intralipid impaired TBC1D4 S341 phosphorylation compared with the control trial. Intralipid enhanced pyruvate dehydrogenase (PDH) phosphorylation and lactate release. Prior exercise led to higher PDH phosphorylation and activation of glycogen synthase compared with resting control. In conclusion, lipid-induced insulin resistance in skeletal muscle was associated with impaired TBC1D4 S341 and elevated PDH phosphorylation. The prophylactic effect of exercise on lipid-induced insulin resistance may involve augmented TBC1D4 signaling and glycogen synthase activation