Type 2 diabetes is characterized by insulin resistance in the expanding adipose tissue of obesity. The insulin resistance manifests in human adipocytes as system-wide impairment of insulin signalling. An exception is the regulation of transcription factor FOXO1 (forkhead box protein O1), which is phosphorylated downstream of mTORC2 (mammalian/mechanistic target of rapamycin in complex with raptor) and is therefore not exhibiting impaired response to insulin. However, the abundance, and activity, of FOXO1 is reduced by half in adipocytes from patients with diabetes. To elucidate the effect of reduced FOXO1 activity, we here transduced human adipocytes with a dominant-negative construct of FOXO1 (DN-FOXO1). Inhibition of FOXO1 reduced the abundance of insulin receptor, glucose transporter-4, ribosomal protein S6, mTOR and raptor. Functionally, inhibition of FOXO1 induced an insulin-resistant state network-wide, a state that qualitatively and quantitatively mimicked adipocytes from patients with type 2 diabetes. In contrast, and in accordance with these effects of DN-FOXO1, overexpression of wild-type FOXO1 appeared to augment insulin signalling. We combined experimental data with mathematical modelling to show that the impaired insulin signalling in FOXO1-inhibited cells to a large extent can be explained by reduced mTORC1 activity - a mechanism that defines much of the diabetic state in human adipocytes. Our findings demonstrate that FOXO1 is critical for maintaining normal insulin signalling of human adipocytes.