We examined the impact of hypertension and microalbuminuria on insulin sensitivity in patients with Type 2 (non-insulin-dependent) diabetes mellitus using the euglycaemic insulin clamp technique in 52 Type 2 diabetic patients and in 19 healthy control subjects. Twenty-five diabetic patients had hypertension and 19 had microalbuminuria. Hypertension per se was associated with a 27% reduction in the rate of total glucose metabolism and a 40% reduction in the rate of non-oxidative glucose metabolism compared with normotensive Type 2 diabetic patients (both p < 0.001). Glucose metabolism was also impaired in normotensive microalbuminuric patients compared with normotensive normoalbuminuric patients (29.4 +/- 2.2 vs 40.5 +/- 2.8 mumol.kg lean body mass-1.min-1; p = 0.012), primarily due to a reduction in non-oxidative glucose metabolism (12.7 +/- 2.9 vs 21.1 +/- 2.6 mumol.kg lean body mass-1.min-1; p = 0.06). In a factorial ANOVA design, however, only hypertension (p = 0.008) and the combination of hypertension and microalbuminuria (p = 0.030) were significantly associated with the rate of glucose metabolism. The highest triglyceride and lowest HDL cholesterol concentrations were observed in Type 2 diabetic patients with both hypertension and microalbuminuria. Of note, glucose metabolism was indistinguishable from that in control subjects in Type 2 diabetic patients without hypertension and microalbuminuria (40.5 +/- 2.8 vs 44.4 +/- 2.8 mumol.kg lean body mass-1.min-1). We conclude that insulin resistance in Type 2 diabetes is predominantly associated with either hypertension or microalbuminuria or with both.