Insulin is the most-potent physiological anabolic agent known, promoting the synthesis and storage of carbohydrates and lipids and inhibiting their degradation and release into the circulation. This action of the hormone is due in part to the acute regulation of metabolic enzymes through changes in their phosphorylation state. In fat, liver, and muscle, insulin stimulates the dephosphorylation of a number of enzymes involved in glycogen and lipid metabolism via activation of protein phosphatases. Numerous studies have indicated that protein phosphatase-1 (PP1) is the primary phosphatase involved in insulin action. Although PP1 is a cytosolic protein, the phosphatase is compartmentalized in cells by discrete targeting subunits. These proteins confer substrate specificity to PP1 and mediate the specific regulation of intracellular pools of PP1 by a variety of extracellular signals. Four proteins have been described that target the phosphatase to the glycogen particle. G(M) and GL are expressed exclusively in striated muscle and liver, while protein targeting to glycogen (PTG) and R6 are more widely expressed. Despite a common targeting function, these four proteins are not highly conserved, suggesting profound differences in the mechanisms by which they contribute to the hormonal regulation of PP1 activity. Overexpression studies in cell lines or animals have revealed major differences among these proteins regarding basal glycogen levels and hormonal responsiveness. Furthermore, alterations in the expression or function of PP1 glycogen-targeting subunits may contribute to the onset of insulin resistance and type 2 diabetes.