Mitochondrial uncoupling proteins (UCPs) are transporters that are important for thermogenesis. The net result of their activity is the exothermic movement of protons through the inner mitochondrial membrane, uncoupled from ATP synthesis. We have cloned a third member of the UCP family, UCP3. UCP3 is expressed at high levels in muscle and rodent brown adipose tissue. Overexpression in yeast reduced the mitochondrial membrane potential, showing that UCP3 is a functional uncoupling protein. UCP3 RNA levels are regulated by hormonal and dietary manipulations. In contrast, levels of UCP2, a widely expressed UCP family member, showed little hormonal regulation. In particular, muscle UCP3 levels were decreased 3-fold in hypothyroid rats and increased 6-fold in hyperthyroid rats. Thus UCP3 is a strong candidate to explain the effects of thyroid hormone on thermogenesis. White adipose UCP3 levels were greatly increased by treatment with the beta3-adrenergic agonist, CL214613, suggesting another pathway for increasing thermogenesis. UCP3 mRNA levels were also regulated by dexamethasone, leptin, and starvation, albeit differently in muscle and brown adipose tissue. Starvation caused increased muscle and decreased BAT UCP3, suggesting that muscle assumes a larger role in thermoregulation during starvation. The UCP3 gene is located close to that encoding UCP2, in a chromosomal region implicated in previous linkage studies as contributing to obesity.