Regulation of adipose tissue formation by adipogenic-regulatory proteins has long been a topic of interest given the ever-increasing health concerns of obesity and type 2 diabetes in the general population. Differentiation of precursor cells into adipocytes involves a complex network of cofactors that facilitate the functions of transcriptional regulators from the CCATT/enhancer binding protein, and the peroxisome proliferator-activated receptor (PPAR) families. Many of these cofactors are enzymes that modulate the structure of chromatin by altering histone-DNA contacts in an ATP-dependent manner or by posttranslationally modifying the histone proteins. Here we report that inhibition of protein arginine methyltransferase 5 (Prmt5) expression in multiple cell culture models for adipogenesis prevented the activation of adipogenic genes. In contrast, overexpression of Prmt5 enhanced adipogenic gene expression and differentiation. Chromatin immunoprecipitation experiments indicated that Prmt5 binds to and dimethylates histones at adipogenic promoters. Furthermore, the presence of Prmt5 promoted the binding of ATP-dependent chromatin-remodeling enzymes and was required for the binding of PPARγ2 at PPARγ2-regulated promoters. The data indicate that Prmt5 acts as a coactivator for the activation of adipogenic gene expression and promotes adipogenic differentiation.