Peroxisome proliferator-activated receptor γ (PPARγ) is a ligand-dependent transcriptional factor implicated in regulating adipogenesis, glucose homeostasis, and in mediating the action of the insulin sensitizing anti-diabetic thiazolidinedione (TZD) compounds. [3-(2,4-Dichlorobenzyl)-2-methyl-N-(pentylsulfonyl)-3-H-benzimidazole-5-carboxamide] (FK614) is a structurally novel PPARγ agonist that demonstrates potent anti-diabetic activity in vivo. Herein, we describe that FK614 is a selective PPARγ ligand with specific transactivation properties that are dependent upon the context of coactivators. FK614 dissociates the corepressors NCoR (nuclear receptor corepressor) and SMRT (silencing mediator of retinoid and thyroid hormone receptors) from PPARγ as effectively as rosiglitazone and pioglitazone, but can also differentially induce a ligand specific interaction of PPARγ with coactivators. The amount of CBP (CREB-binding protein) and SRC-1 (steroid receptor coactivator-1) recruited by FK614 was less than that induced by rosiglitazone and pioglitazone, but FK614 caused similar PGC-1α (PPARγ coactivator-1α) recruitment as these compounds. As a consequence of these ligand-specific differences in the strength of ligand-type specific interactions of PPARγ and coactivators, FK614 functions as a partial or full agonist for transcriptional activation depending upon the amount of specific coactivators in cells following overexpression. In conclusion, FK614 is a novel, non-TZD type, and selective PPARγ modulator whose pharmacological properties are distinct from rosiglitazone and pioglitazone.