Low circulating adiponectin levels may contribute to higher diabetes risk among Mexican Americans (MA) compared to non-Latino whites (NLW). Our objective was to determine if among young healthy adult MAs have lower adiponectin than NLWs, independent of differences in adiposity. In addition, we explored associations between adiponectin and diet. This was an observational, cross-sectional study of healthy MA and NLW adults living in Colorado (U.S.A.). We measured plasma total adiponectin, adiposity (BMI, and visceral adipose tissue), insulin sensitivity (IVGTT), and self-reported dietary intake in 43 MA and NLW adults. Mean adiponectin levels were 40% lower among MA than NLW (5.8 ± 3.3 vs. 10.7 ± 4.2 µg/mL, p = 0.0003), and this difference persisted after controlling for age, sex, BMI, and visceral adiposity. Lower adiponectin in MA was associated with lower insulin sensitivity (R² = 0.42, p < 0.01). Lower adiponectin was also associated with higher dietary glycemic index, lower intake of vegetables, higher intake of trans fat, and higher intake of grains. Our findings confirm that ethnic differences in adiponectin reflect differences in insulin sensitivity, but suggest that these are not due to differences in adiposity. Observed associations between adiponectin and diet support the need for future studies exploring the regulation of adiponectin by diet and other environmental factors.