We have examined the effect of chronic (4 weeks) phlorizin treatment (osmotic minipumps) on tissue sensitivity to insulin in adult female rats with non-insulin-dependent diabetes (NIDD) induced by streptozotocin (STZ) (80 mg/kg) administered 5 days after birth. Insulin sensitivity was assessed with the euglycemic-hyperinsulinemic clamp technique in anesthetized animals. In the untreated diabetic rats, the basal glucose production (GP) and glucose utilization (GU) were increased (P less than .001), and both the liver and peripheral tissues showed insulin resistance. In the phlorizin-treated diabetic rats, postabsorptive plasma glucose levels were decreased and remained stable during the last 3 weeks of the treatment (142 +/- 3 mg/dL as compared with 308 +/- 19 in the untreated diabetic rats and 119 +/- 3 in the phlorizin-control rats); their percent glycosylated hemoglobin values returned to normal (3.2 +/- 0.2 as compared with 5.8 +/- 0.4 in the untreated diabetic rats); their basal plasma insulin levels (55 +/- 5 microU/mL as compared with 52 +/- 3 in the untreated diabetic rats and 130 +/- 10 in the phlorizin-control rats), their in vivo glucose-induced insulin secretion, and their pancreatic insulin content were kept unchanged. In the phlorizin-treated diabetic rats, the basal GP and GU were normalized. Following a submaximal or maximal hyperinsulinemia, GP was normally suppressed and GU normally enhanced. Phlorizin treatment in the control rats did not affect any of the above parameters. These data demonstrate that correction of hyperglycemia with phlorizin normalizes insulin action on glucose metabolism by the liver and peripheral tissues in this diabetic model. This is in line with the proposal that hyperglycemia per se can lead to the development of insulin resistance.