1. The thiazolidinedione compound, troglitazone, enhances insulin action and reduces plasma glucose concentrations when administered chronically to type 2 diabetic patients. 2. To analyse to what extent thiazolidinediones interfere with liver function, we examined the acute actions of troglitazone (0.61 and 3.15 microM) on hepatic glucose and lactate fluxes, bile secretion, and portal pressure under basal, insulin- and/or glucagon-stimulated conditions in isolated perfused rat livers. 3. During BSA-free perfusion, high dose troglitazone increased basal (P < 0.01), but inhibited glucagon-stimulated incremental glucose production by approximately 75% (10.0 +/- 2.5 vs control: 40.0 +/- 7.2 micromol g liver(-1), P < 0.01). In parallel, incremental lactate release rose approximately 6 fold (13.1 +/- 5.9 vs control: 2.2 +/- 0.8 mmol g liver(-1), P < 0.05), while bile secretion declined by approximately 67% [0.23 +/- 0.02 vs control: 0.70 +/- 0.05 mg g liver(-1) min(-1)), P < 0.001]. Low dose troglitazone infusion did not enhance the inhibitory effect of insulin on glucagon-stimulated glucose production, but rapidly increased lactate release (P < 0.0005) and portal venous pressure (+0.17 +/- 0.07 vs +0.54 +/- 0.07 cm buffer height, P < 0.0001). 4. These results indicate that troglitazone exerts both insulin-like and non-insulin-like hepatic effects, which are blunted by addition of albumin, possibly due to troglitazone binding.