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Hepatic activation of protein kinase C (PKC) isoforms by diacylglycerol (DAG) promotes insulin resistance and contributes to the development of type 2 diabetes (T2D). The closely related protein kinase D (PKD) isoforms act as effectors for DAG and PKC. Here, we showed that PKD3 was the predominant PKD isoform expressed in hepatocytes and was activated by lipid overload. PKD3 suppressed the activity of downstream insulin effectors including the kinase AKT and mechanistic target of rapamycin complex 1 and 2 (mTORC1 and mTORC2). Hepatic deletion of PKD3 in mice improved insulin-induced glucose tolerance. However, increased insulin signaling in the absence of PKD3 promoted lipogenesis mediated by SREBP (sterol regulatory element-binding protein) and consequently increased triglyceride and cholesterol content in the livers of PKD3-deficient mice fed a high-fat diet. Conversely, hepatic-specific overexpression of a constitutively active PKD3 mutant suppressed insulin-induced signaling and caused insulin resistance. Our results indicate that PKD3 provides feedback on hepatic lipid production and suppresses insulin signaling. Therefore, manipulation of PKD3 activity could be used to decrease hepatic lipid content or improve hepatic insulin sensitivity.