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Using random germline mutagenesis in mice, we identified a viable hypomorphic allele (boh) of the transcription-factor-encoding gene Ovol2 that resulted in obesity, which initially developed with normal food intake and physical activity but decreased energy expenditure. Fat weight was dramatically increased, while lean weight was reduced in 12-week-old boh homozygous mice, culminating by 24 weeks in massive obesity, hepatosteatosis, insulin resistance, and diabetes. The Ovol2 boh/boh genotype augmented obesity in Lep ob/ob mice, and pair-feeding failed to normalize obesity in Ovol2 boh/boh mice. OVOL2-deficient mice were extremely cold intolerant. OVOL2 is essential for brown/beige adipose tissue-mediated thermogenesis. In white adipose tissues, OVOL2 limited adipogenesis by blocking C/EBPα engagement of its transcriptional targets. Overexpression of OVOL2 in adipocytes of mice fed with a high-fat diet reduced total body and liver fat and improved insulin sensitivity. Our data reveal that OVOL2 plays dual functions in thermogenesis and adipogenesis to maintain energy balance. [Display omitted] • A viable hypomorphic allele of Ovol2 (Ovol2 boh , p.C120Y) causes obesity in mice • Obesity in Ovol2 boh/boh develops with normal food intake and reduced energy expenditure • OVOL2-deficient mice are cold intolerant with defective brown/beige adipose tissues • OVOL2 inhibits transcriptional activity of C/EBPα and suppresses white adipogenesis Using a forward genetic screen, Zhang et al. identified a new mouse obesity syndrome caused by a viable hypomorphic mutation in the transcription-factor-encoding gene Ovol2. They discovered that OVOL2 plays dual roles in promoting brown/beige thermogenesis and inhibiting white adipocyte differentiation to maintain energy balance. [ABSTRACT FROM AUTHOR]