Several lines of evidence suggested that adipose tissue-resident macrophages (ATMs) are involved in maintaining insulin sensitivity in adipocytes along with improvement in metabolic genes. Much has been known about M1 ATMs role in the inflammatory process in obese adipose tissue which is known closely related with the development of insulin resistance both in human and animal. In contrast, M2-like ATM in lean state enhances the insulin sensitivity. Nonetheless, it is largely unknown how depletion of M2 ATMs regulates insulin sensitivity and adipocyte progenitors (APs) proliferation. To understand the role of M2 macrophages in adipose tissue, I generated CD206DTR mice based on transgenic expression of diphtheria toxin receptor under the control of CD206(+) promoter to specifically deplete CD206 M2 macrophages. Depletion of CD206 M2 macrophages resulted in the generation of smaller adipocytes, upregulated expression of metabolically favourable genes and enhanced insulin sensitivity in both chow ad high fat diet-fed CD206-reduced mice. In vivo and in vitro study revealed that TGFb abundantly expressed in CD206+ ATMs, thus regulating APs differentiation and proliferation. Flow cytometry analysis revealed that the number of APs was increased and cyclin gene expression levels in APs fraction were up-regulated. To confirm the identity and the fate of proliferating cells, PDGFRa(+) cells were labelled with EdU (2 hours post-EdU). After 96 hours, EdU labelled nuclei were differentiated into multilocular perilipin (+) adipocytes. To validate this hypothesis, I generated a genetically engineered mouse in which TGFβ1 expression was specifically depleted within CD206 M2 macrophage after tamoxifen treatment. Increased number of APs and smaller adipocytes were observed in the CD206 specific TGFb1 knockout mice. Here we show that CD206 M2 macrophages in adipose tissues are involved in regulating the proliferation and differentiation of APs through TGFb signalling to adjust adiposity and insulin sensitivity throughout the whole body.