Epidemiological studies estimate that by the year 2030, 2.16billion people worldwide will be overweight and 1.12billion will be obese 1. Besides its now established function as an endocrine organ, adipose tissue plays a fundamental role as an energy storage compartment. As such, adipose tissue is capable of extensive expansion or retraction depending on the energy balance or disease state of the host, a plasticity that is unparalleled in other organs and – under conditions of excessive energy intake – significantly contributes to the afore mentioned obesity pandemic. Expansion of adipose tissue is driven by both hypertrophy and hyperplasia of adipocytes, which can renew frequently to compensate for cell death. This underlines the importance of adipocyte progenitor cells within the distinct adipose tissue depots to control both energy storage and endocrine functions of adipose tissue. Here we summarize recent findings on the identity and plasticity of adipose stem cells, the involved signaling cascades, and potential clinical implications of these cells for the treatment of metabolic dysfunction in obesity. This article is part of a Special Issue entitled Brown and White Fat: From Signaling to Disease. ► Adipocyte progenitors derive from pluripotent mesenchymal stem cells. ► Brown and white adipocytes develop from distinct cell lineages. ► Inducible brown adipocytes arise from progenitor differentiation or white adipocyte trans-differentiation. ► Recruitment of brown adipose tissue in humans may provide a novel approach to anti-obesity therapies.