A number of 2,4-thiazolidinedione derivatives of -phenyl substituted cinnamic acid were synthesized and studied for their PPAR agonist activity. The E-isomer of cinnamic acid, 11, showed moderate PPAR transactivation. The corresponding Z-isomer, 23, and double bond reduced derivative, 15, were found to be much less potent. Although the E-isomer showed a moderate PPAR gamma transactivation, it demonstrated a strong glucose-lowering effect in a genetic rodent model of diabetes. Results of pharmacokinetic, metabolism and permeability studies are consistent with 11 being an active prodrug with an active metabolite, 14, that has similar glucose lowering and PPAR gamma agonist properties.