To determine the effect of hydroxychloroquine (HCQ) on skeletal muscle and liver insulin sensitivity, insulin clearance, inflammation and adipokines. Insulin-resistant adults without rheumatic disease were randomized to 13 weeks of HCQ (400 mg/day) versus placebo (double-blinded). Primary outcomes were changes in skeletal muscle and liver insulin sensitivity assessed by hyperinsulinaemic-euglycaemic clamp and stable-isotope tracer methods. Secondary outcomes included insulin clearance, inflammation biomarkers and adipokines. Compared with placebo, HCQ significantly improved skeletal muscle insulin sensitivity by 26% (p = .019) and enhanced systemic glucose clearance (p = .025). By contrast, HCQ had no effect on hepatic insulin sensitivity. HCQ did not affect insulin clearance but decreased circulating IL-6 (p = .01) and increased adiponectin (p = .045). There were no effects on leptin, RBP-4, FGF-21 or C-reactive protein. HCQ selectively enhances insulin sensitivity and glucose disposal in skeletal muscle, without affecting hepatic insulin sensitivity or insulin clearance. These findings offer a mechanistic explanation for the antidiabetic properties of HCQ and suggest that this medication might be useful in conditions linked to insulin resistance such as type 2 diabetes.