Hypercortisolemia and glucocorticoid treatment cause elevated level of circulating free fatty acids (FFAs). The basis of this phenomenon has long been linked to the effect of glucocorticoids permitting and enhancing the adipose lipolysis response to various hormones. In this study, we demonstrate that glucocorticoids directly stimulate lipolysis in rat primary adipocytes in a dose- and time-responsive manner; this lipolytic action was attenuated by treatment with the glucocorticoid antagonist RU486. Dexamethasone downregulates mRNA and protein levels of cyclic-nucleotide phosphodiesterase 3B, thereby elevating cellular cAMP production and activating protein kinase A (PKA). On inhibition of PKA but not other kinases, the lipolysis response ceases. Further, dexamethasone induces phosphorylation and downregulation of perilipin, a lipid droplet-associating protein that modulates lipolysis; this effect is restored by RU486 or PKA inhibitor H89. Dexamethasone upregulates mRNA and protein levels of hormone-sensitive lipase (HSL) and adipose triglyceride lipase; these effects, parallel to increased lipolysis, are attenuated by RU486 or actinomycin D. Phosphorylation at Ser-563 and Ser-660 residues of HSL and activity of cellular lipases are elevated on dexamethasone stimulation but abrogated by the coaddition of H89. However, dexamethasone does not induce HSL translocation to the lipid droplet surface in differentiated adipocytes. We show that elevated FFA concentration in plasma is associated with increased lipase activity and lipolysis in vivo in adipose tissues of dexamethasone-treated rats. Therefore, the lipolytic action of glucocorticoids liberates FFA efflux from adipocytes to the bloodstream, which could be a cellular basis of systemic FFA elevation in response to glucocorticoid challenge.