Recently, insulin resistance and metabolic syndrome have been increasing as obesity increases in diabetic patients. TZD is an insulin sensitizer that lowers insulin resistance and has a strong hypoglycemic effect. The aim of this study was to compare the effect of TZD and DPP-4 inhibitor on the blood glucose lowering effect as well as the lipid-lowering effect in patients with insufficient blood glucose control by metformin. We conducted a multi-center, randomized, double-blind, active-controlled trial in 247 Korean patients. Patients who were inadequately controlled by metformin (≥ 1,000 mg/day) were randomized and treated once daily with either lobeglitazone (0.5 mg, n = 121) or sitagliptin (100 mg, n = 126) for 24 weeks. The primary endpoint was the change in glycated hemoglobin (HbA1c) from baseline to the end of treatment. The secondary endpoints included the proportion of patients having metabolic syndrome, various glycemic parameters, lipid parameters and safety profile. At 24 weeks, the mean changes in HbA1c of lobeglitazone group and sitagliptin group were -0.79% and -0.86%, respectively; the between-group difference was -0.08% (95% confidence interval, -0.1444 to 0.3011%), demonstrating non-inferiority, meeting the pre-specified margin of 0.40%. The proportion of the metabolic syndrome according to modified Adult Treatment Panel III criteria significantly declined in patients receiving lobeglitazone compared with patients receiving sitagliptin (-11.87% vs - 4.8%; P < .0174), mainly by the difference of dyslipidemia. Compared with the sitagliptin group, the lobeglitazone group produced greater decease in level of triglycerides (mean change, -17.90 vs 9.29 mg/dL; P < .007) and a greater increase in level of high-density lipoprotein cholesterol (mean change, 2.97 vs -1.25 mg/dL; P < .001). In addition, lobeglitazone treatment significantly improved the level of free fatty acid (P < 0.031) and the level of adiponectin (P < .001) compared with sitagliptin treatment. Insulin resistance estimated by the HOMA-IR significantly decreased in patients receiving lobeglitazone but not in patients receiving sitagliptin. The safety profile was comparable between the two groups and lobeglitazone was well tolerated. The adverse events that occurred at an incidence of ≥3% during the 24-week treatment period were facial edema, nasopharyngitis and dyspepsia (3.33%, 1.67 % and 1.67% in the lobeglitazone group vs. 0%, 4.76% and 3.17% in the sitagliptin group, respectively) In this study, lobeglitazone 0.5mg treatment was not inferior to sitagliptin 100mg treatment as an add-on to metformin in terms of their glycemic efficacy and safety. Also, lobeglitazone provided more effective control in dyslipidemia compared with sitagliptin in Korean patients with T2D and metabolic syndrome.