Chronic renal failure is associated with altered insulin sensitivity of unclear etiology. To investigate the effect of renal failure on insulin binding, we studied insulin binding in mature erythrocytes from 5 undialyzed and 12 chronically dialyzed patients with renal failure. The cell suspension of the isolated and purified human erythrocytes (3.52 × 10<sup>9</sup>/ml) was incubated with 100 pg of <sup>125</sup>I-insulin and a range of unlabeled insulin concentrations (pH 8.0, 15°C for 3.5 h). A maximum of 7.9 ± 1.6 and 14.1 ± 3.5 (mean ± SD) specific percent of <sup>125</sup>I-insulin was bound by the undialyzed and dialyzed patients respectively, as compared to 10.1 ± 1.4 (mean ± SD) maximum specific percent of insulin bound by the normal subjects. Scatchard plots from the normal, undialyzed and dialyzed subjects were curvilinear, indicating negatively cooperative insulin receptor site-site interactions. From the DeMeyts1 analyses of the Scatchard plots, it was determined that the unoccupied receptor site affinity constant, K<sub>e</sub>, for the normal subjects was 0.5 × 108 M<sup>-1</sup> whereas that for the undialyzed and the dialyzed patients was 0.69 × 108 M<sup>-1</sup>. The normal subjects had 410 receptor sites per erythrocyte; however, the undialyzed patients had 215 sites per cell and the dialyzed patients had a receptor number similar to that of the normal subjects. The undialyzed patients had 48% fewer receptor sites than the dialyzed patients and the normal subjects. The undialyzed patients comparing with the normal subjects thus, showed a reduction in insulin binding and in the number of receptor sites with increased affinity. Chronic dialysis caused an increase of insulin binding and of receptor number when compared with the undialyzed patients. In the undialyzed patients with renal failure, the defect in receptor number may be associated with a defect in tissue response to insulin. This defect in insulin receptor number was removed with chronic dialysis. Thus, chronic dialysis may improve insulin sensitivity at the cellular level.