We use National Longitudinal Survey of Youth (NLSY) data to examine the effects of obesity on wages by gender. Sample means indicate that both men and women experience a persistent obesity wage penalty over the first two decades of their careers. We then control for a standard set of socioeconomic and familial variables but find that standard covariates do not explain why obese workers experience persistent wage penalties. This suggests that other variables – including job discrimination, health‐related factors and/or obese workers' behavior patterns – may be the channels through which obesity adversely affects wages. The study closes with a discussion of the public policy implications suggested by these findings. Copyright © 2004 John Wiley & Sons, Ltd.