The gp130 receptor cytokines IL-6 and CNTF improve metabolic homeostasis but have limited therapeutic use for the treatment of type 2 diabetes. Accordingly, we engineered the gp130 ligand IC7Fc, in which one gp130-binding site is removed from IL-6 and replaced with the LIF-receptor-binding site from CNTF, fused with the Fc domain of immunoglobulin G, creating a cytokine with CNTF-like, but IL-6-receptor-dependent, signalling. Here we show that IC7Fc improves glucose tolerance and hyperglycaemia and prevents weight gain and liver steatosis in mice. In addition, IC7Fc either increases, or prevents the loss of, skeletal muscle mass by activation of the transcriptional regulator YAP1. In human-cell-based assays, and in non-human primates, IC7Fc treatment results in no signs of inflammation or immunogenicity. Thus, IC7Fc is a realistic next-generation biological agent for the treatment of type 2 diabetes and muscle atrophy, disorders that are currently pandemic.