Obesity is a major pathological factor that induces insulin resistance and consequent type 2 diabetes through multiple mechanisms. Inactivation of the insulin receptor (INSR) contributes to the development of insulin resistance, whose protein level is down-regulated in obesity through as yet-undefined mechanisms. Here we show that the E3-ligase TRAF6 is a critical regulator of INSR maturation, whose inactivation prevents palmitic acid- or high-fat diet-induced diminution of the INSR. Consequently, genetic inactivation of TRAF6 enhances insulin signaling that further increases muscle glucose uptake and inhibits hepatic gluconeogenesis. TRAF6 inactivation increases the proprotein convertase FURIN that controls the processing of pro-INSR to mature INSR. Mechanistically, TRAF6 associates with the Golgi apparatus, where it ubiquitinates the cytosolic tail of FURIN, leading to its lysosomal degradation. This TRAF6-FURIN axis also regulates cholesterol metabolism via PCSK9 processing in the circulation. Collectively, our results reveal a critical role of TRAF6 in regulating proprotein processing and have therapeutic implications for metabolic control.