TFE3 and TFEB are members of the MiT family of HLH-leucine zipper transcription factors. Recent studies demonstrated that they bind overlapping sets of promoters and are post-transcriptionally regulated through a similar mechanism. However, while Tcfeb knockout (KO) mice die during early embryonic development, no apparent phenotype was reported in Tfe3 KO mice. Thus raising the need to characterize the physiological role of TFE3 and elucidate its relationship with TFEB. TFE3 deficiency resulted in altered mitochondrial morphology and function both in vitro and in vivo due to compromised mitochondrial dynamics. In addition, Tfe3 KO mice showed significant abnormalities in energy balance and alterations in systemic glucose and lipid metabolism, resulting in enhanced diet-induced obesity and diabetes. Conversely, viral-mediated TFE3 overexpression improved the metabolic abnormalities induced by high-fat diet (HFD). Both TFEB overexpression in Tfe3 KO mice and TFE3 overexpression in Tcfeb liver-specific KO mice (Tcfeb LiKO) rescued HFD-induced obesity, indicating that TFEB can compensate for TFE3 deficiency and vice versa. Analysis of Tcfeb LiKO/Tfe3 double KO mice demonstrated that depletion of both TFE3 and TFEB results in additive effects with an exacerbation of the hepatic phenotype. These data indicate that TFE3 and TFEB play a cooperative, rather than redundant, role in the control of the adaptive response of whole-body metabolism to environmental cues such as diet and physical exercise.