Adiponectin stimulates mitochondrial biogenesis through peroxisome proliferator-activated receptor-γ coactivator 1α (PGC-1α), a major regulator of mitochondrial biogenesis. MOTS-c (mitochondrial open reading frame of the 12S rRNA) is a biologically active mitochondrial-derived peptide encoded by mitochondrial DNA. It influences the mechanisms of obesity and diabetes. We hypothesised that the adiponectin pathway may regulate the production and/or secretion of MOTS-c in skeletal muscle. We aimed to determine whether exercise and adiponectin affect MOTS-c to improve insulin resistance in mice. To investigate this hypothesis, we used wild-type C57BL/6 mice subjected to high-fat diet, an exercise regimen, and i.p. injection of recombinant mouse adiponectin (Acrp30) or MOTS-c, and adiponectin knockout (Adipoq-/-) mice (C57BL/6 background) subjected to i.p. injection of Acrp30. C2C12 myotubes were also treated with sirtuin 1 (SIRT1) inhibitor, PGC-1α inhibitor, SIRT1 activator, plasmid-expressed active APPL1 (adaptor protein, phosphotyrosine interacting with PH domain and leucine zipper), pcDNA-SIRT1, or siRNA against APPL1, SIRT1 or PGC-1α. In Adipoq-/- mice, MOTS-c levels in the plasma and skeletal muscle were downregulated. In C2C12 myotubes, adiponectin increased the mRNA expression of MOTS-c. APPL1 protein level following adiponectin treatment positively correlated with MOTS-c protein and mRNA levels in C2C12 myotubes. SIRT1 overexpression increased the adiponectin-induced mRNA and protein expression of MOTS-c, SIRT1 and PGC-1α. Pharmacologic and genetic inhibition of PGC-1α suppressed the increases in MOTS-c mRNA and protein levels induced by SIRT1 overexpression. In mice, plasma and skeletal muscle MOTS-c levels were significantly downregulated following high-fat-diet. Exercise and i.p. Acrp30 or MOTS-c increased MOTS-c levels and adiponectin mRNA and protein expression in the plasma and skeletal muscle. Our findings showed that the APPL1-SIRT1-PGC-1α pathway regulates the production and/or secretion of skeletal muscle MOTS-c by mediating adiponectin signalling. Our study provides an insight into the cellular and molecular pathways underlying the pathogenesis of diabetes and shows that MOTS-c is a potential novel therapeutic target in the treatment of diabetes. Graphical abstract.