The prevalence of overweight and obesity in children and adolescents in the United States has doubled during the past 20 years. Obesity is closely linked with development of insulin resistance and other mediators of unfavorable cardiovascular risk, such as hypertension and dyslipidemia. These obesity-related risk factors often first appear during childhood. Since obese children tend to become obese adults, such children are at increased risk for persistence of these abnormalities into adulthood and for the early occurrence of obesity-related morbidity and mortality. Obesity-related insulin resistance is also largely responsible for the recently documented rise in the incidence of Type 2 diabetes in youth. To date, there is no FDA-approved pharmacotherapy for children with obesity and insulin resistance. Metformin is a medication approved for use in adults with Type 2 diabetes that is unique in that it promotes weight loss and improves features of the insulin resistance syndrome. Preliminary studies suggest that metformin may promote weight loss in obese non-diabetic children. However, the mechanism of metformin-induced weight loss has not been elucidated. We propose to evaluate the safety, tolerability, efficacy and mechanism of metformin-induced weight loss in obese, hyperinsulinemic children aged 6-12.99 years. We will conduct a six-month randomized, double blind placebo-controlled trial of metformin. All study participants will receive nutritional consultation and advice on appropriate diet. We will study the effects of metformin on weight, food intake, energy expenditure, insulin sensitivity, and lipids. At the end of the six-month placebo-controlled trial, all subjects will be offered metformin in an open label phase for an additional six months.