Rats were injected with streptozotocin at 2 days of age. After 10–14 wk, the injected rats showed normal body weight with only modestly elevated fed plasma glucose (controls: 118 mg/dl, diabetic rats: 209 mg/dl). No significant difference between control and diabetic rats was found for overnight fasting plasma insulin levels. The diabetic rats had a retarded rate of disposal of intravenously injected glucose, with only 13% of the incremental increase in plasma insulin seen in control rats 2 min after glucose injection. The immunoreactive insulin content of islets isolated from the diabetic rats was 14% of controls. However, these islets had 74% of the B-cell composition of controls, as estimated by quantitative morphometry. Insulin release (30 min) was lower from islets from diabetic rats than from controls, but was not lowered to the same extent as islet insulin content. Proinsulin biosynthesis was estimated by measuring the incorporation of [3H] leucine or of [3H] phenylalanine into immunoprecipitable material. Proinsulin biosynthesis was strikingly elevated in islets from diabetic rats. Although incorporation of labeled amino acids into total islet protein was also elevated for islets from diabetic rats, the elevation was less pronounced than for incorporation into immunoprecipitable material. The diabetic state of these animals is thus associated with glucose intolerance in vivo, and an increased rate of insulin turnover in isolated islets studied in vitro.