Metabolic flexibility (MF) refers to the ability to suppress lipid and increase glucose oxidation (as reflected by increase in the respiratory quotient [ΔRQ]) under insulin-stimulated conditions. It is not clear if youth with type 2 diabetes (T2D) and prediabetes have a defect in MF compared with controls. We investigated the determinants of MF in youth with normal weight (NW) and obesity (OB) across the spectrum of glucose tolerance. Youth (n=104; 15.6±1.8 yrs, Tanner stage (TS) II-V) had evaluation of body composition (DXA), visceral fat (VAT) in a subset (MRI), RQ (indirect calorimetry) fasting and during a hyperinsulinemic-euglycemic clamp for measurement of glucose disposal rate (GDR) and insulin sensitivity (IS). Youth with prediabetes and T2D had lower ∆RQ, and lower oxidative and non-oxidative GDR compared to NW with no significant difference in ΔRQ between NW and OB-NGT (Table). ∆RQ correlated with GDR, IS (r=0.3, p=0.02), VAT (r=-.23, p=0.04), and HbA1c (r=-.26, p=0.03) after adjusting for sex, race and TS, but not with % body fat. In multiple regression, Rd (or IS) (β=0.26, p=0.04) and race-ethnicity (β= -0.3, p=0.01) contributed to the variance in ∆RQ (R2=0.25, p=0.005) independent of % body fat, VAT, sex, TS and HbA1c. MF is impaired in youth with prediabetes/T2D compared with NGT-OB and NW in relation to a defect in glucose disposal and appears to be modulated by race-ethnicity (lower in Hispanics). Disclosure F. Bacha: Research Support; Self; AstraZeneca, Takeda Development Center Americas, Inc. S.K. Bartz: None. I. Jindal: None. M.R. Puyau: None. A. Adolph: None. S. Sharma: None. Funding U.S. Department of Agriculture