Lifestyle interventions, including dietary adjustments and exercise, are important for obesity management. This study enrolled adults with overweight or obesity to explore whether either low-carbohydrate diet (LCD) or exercise is more effective in metabolism improvement. Forty-five eligible subjects were randomly divided into an LCD group (n = 22) and an exercise group (EX, n = 23). The subjects either adopted LCD (carbohydrate intake < 50 g/day) or performed moderate-to-vigorous exercise (⩾ 30 min/day) for 3 weeks. After the interventions, LCD led to a larger weight loss than EX ( - 3.56 ± 0.37 kg vs. - 1.24 ± 0.39 kg, P < 0.001), as well as a larger reduction in fat mass ( - 2.10 ± 0.18 kg vs. - 1.25 ± 0.24 kg, P = 0.007) and waist circumference ( - 5.25 ± 0.52 cm vs. - 3.45 ± 0.38 cm, P = 0.008). Both interventions reduced visceral and subcutaneous fat and improved liver steatosis and insulin resistance. Triglycerides decreased in both two groups, whereas low-density lipoprotein cholesterol increased in the LCD group but decreased in the EX group. Various glycemic parameters, including serum glycated albumin, mean sensor glucose, coefficient of variability (CV), and largest amplitude of glycemic excursions, substantially declined in the LCD group. Only CV slightly decreased after exercise. This pilot study suggested that the effects of LCD and exercise are similar in alleviating liver steatosis and insulin resistance. Compared with exercise, LCD might be more efficient for weight loss and glucose homeostasis in people with obesity.