Hyperglycemia (experimental diabetes) was induced in adult male rats by destruction of the pancreatic beta cells with a single intravenous injection of streptozotocin (STZ). Testes from diabetic, from insulin-treated diabetic, and from sham-injected normal rats were fxed by vascular perfusion. The fine structure of Leydig cells was examined at two, three, and four weeks after the STZ injection in the untreated diabetic animals, and at four weeks in the controls and insulin-treated diabetic rats. A number of morphological changes was observed in Leydig cells of untreated diabetic animals. Most obvious of these was an accumulation of lipid droplets, not normally present in Leydig cells in adults of this species. Smooth endoplasmic reticulum (SER) was markedly reduced in Leydig cells of the hyperglycemic rats. Several types of intracellular bodies were seen exclusively in Leydig cells of the untreated diabetic animals. Many resembled secondary lysosomes or dense bodies, while others appeared to be autophagic vacuoles. In addition, a small, granule-containing lamellar structure was seen either within a typical dense body or free in the cytoplasm. Myelin-like structures were commonly observed within the cytoplasm of the Leydig cell or within mitochondria. The appearance of the mitochondria in diabetic rats was otherwise normal. The extracellular spaces surrounding Leydig cells from untreated hyperglycemic rats also contained large accumulations of myelin-like material. These structural changes appear to be direct consequences of the diabetic state of the animals, since the ultrastructure of insulin-treated diabetic rats did not differ from that of the controls. These findings may reflect an alteration or breakdown of Leydig cell components normally involved in the synthesis of androgen, and correlate with previous reports of lowered circulating levels of testosterone in diabetic rats.