Intracellular lipid accumulation (steatosis) and resultant lipotoxicity are key features of diabetic cardiomyopathy. Since cardiac hormone-sensitive lipase (HSL) is activated in diabetic mice, we sought to explore a pathophysiological function of cardiac HSL in the development of diabetic cardiomyopathy. Transgenic (Tg) mice with heart-specific HSL-overexpression were generated and cardiac histology, function, lipid profile, and gene expressions were analyzed after induction of diabetes by streptozotocin. Electron microscopy showed numerous lipid droplets in wildtype (Wt) hearts after 3 weeks of diabetes, whereas Tg mice showed no lipid droplet accumulation. Cardiac content of acylglycerides was increased ~50% with diabetes in Wt mice, whereas this was blunted in Tg hearts. Cardiac lipid peroxide content was 2-fold lower in Tg hearts than Wt hearts. The mRNA expressions for peroxisome proliferator-activated receptor , genes for triacylglycerol synthesis, and lipoprotein lipase were increased with diabetes in Wt hearts, whereas this induction was absent in Tg hearts. Expression of genes associated with lipo-apoptosis was decreased, whereas antioxidant protein metallothioneins were increased in diabetic Tg hearts. Diabetic Wt hearts showed interstitial fibrosis and increased collagen content. However, Tg hearts displayed no overt fibrosis, concomitant with decreased expression of collagens, transforming growth factor-, and matrix metalloproteinase 2. Notably, mortality during the experimental period was approximately 2-fold lower in diabetic Tg mice compared to Wt mice. In conclusion, since HSL-overexpression inhibits cardiac steatosis and fibrosis by apparently hydrolyzing toxic lipid metabolites, cardiac HSL could be a therapeutic target for regulating diabetic cardiomyopathy.