Patients with insulin resistance and type 2 diabetes have poor cardiac outcomes following myocardial infarction (MI). The mitochondrial uncoupling protein 3 (UCP3) is down-regulated in the heart with insulin resistance. We hypothesized that decreased UCP3 levels contribute to poor cardiac recovery following ischemia/reperfusion (I/R). After confirming that myocardial UCP3 levels were systematically decreased by 20–49% in animal models of insulin resistance and type 2 diabetes, we genetically engineered Sprague–Dawley rats with partial loss of UCP3 (ucp3+/−). Wild-type littermates (ucp3+/+) were used as controls. Isolated working hearts from ucp3+/− rats were characterized by impaired recovery of cardiac power and decreased long-chain fatty acid (LCFA) oxidation following I/R. Mitochondria isolated from ucp3+/− hearts subjected to I/R in vivo displayed increased reactive oxygen species (ROS) generation and decreased respiratory complex I activity. Supplying ucp3+/− cardiac mitochondria with the medium-chain fatty acid (MCFA) octanoate slowed electron transport through the respiratory chain and reduced ROS generation. This was accompanied by improvement of cardiac LCFA oxidation and recovery of contractile function post ischemia. In conclusion, we demonstrated that normal cardiac UCP3 levels are essential to recovery of LCFA oxidation, mitochondrial respiratory capacity, and contractile function following I/R. These results reveal a potential mechanism for the poor prognosis of type 2 diabetic patients following MI and expose MCFA supplementation as a feasible metabolic intervention to improve recovery of these patients at reperfusion.