In modern societies, oversupply of calories leads to obesity and chronic metabolic stress, which may lead to development of disease. Oversupply of calories is often associated with elevated plasma lipid concentrations and accumulation of lipids in skeletal muscle leading to decreased insulin sensitivity. Consequently, enhanced fat oxidation might be beneficial in counteracting lipid accumulation. Exercise is the most effective way to increase fat oxidation, because it increases metabolic rate. Lipid metabolism can also be altered by dietary manipulations. Thus, a fat rich diet leads to increased potential for fat oxidation by increasing the content of several of the proteins in the fat oxidative pathway. The regulation of both exercise and diet induced lipid oxidation will be discussed in this review.