Glucose homeostasis is tightly controlled by hormonal regulation of hepatic glucose production. Dysregulation of this system is often associated with insulin resistance and diabetes, resulting in hyperglycemia in mammals. Here, we show that the orphan nuclear receptor estrogen-related receptor γ (ERRγ) is a novel downstream mediator of glucagon action in hepatic gluconeogenesis and demonstrate a beneficial impact of the inverse agonist GSK5182. Hepatic ERRγ expression was increased by fasting-dependent activation of the cAMP-response element-binding protein-CRTC2 pathway. Overexpression of ERRγ induced Pck1 and G6PC gene expression and glucose production in primary hepatocytes, whereas abolition of ERRγ gene expression attenuated forskolin-mediated induction of gluconeogenic gene expression. Deletion and mutation analyses of the Pck1 promoter showed that ERRγ directly regulates the Pck1 gene transcription via ERR response elements of the Pck1 promoter as confirmed by ChIP assay and in vivo imaging analysis. We also demonstrate that GSK5182, an inverse agonist of ERRγ, specifically inhibits the transcriptional activity of ERRγ in a PGC-1α dependent manner. Finally, the ERRγ inverse agonist ameliorated hyperglycemia through inhibition of hepatic gluconeogenesis in db/db mice. Control of hepatic glucose production by an ERRγ-specific inverse agonist is a new potential therapeutic approach for the treatment of type 2 diabetes.