We used anti-insulin-receptor and anti-phosphotyrosine antibodies to elucidate the mechanism of decreased insulin-receptor tyrosine kinase activity observed in subjects with non-insulin-dependent diabetes mellitus (NIDDM). Lectin-purified insulin receptors were labeled with 125I-labeled NAPA-DP-insulin and autophosphorylated in the presence of 500 microM unlabeled ATP. Immunoprecipitation occurred in 43 +/- 8% of the autophosphorylated, 125I-labeled receptors from nondiabetic subjects with anti-phosphotyrosine antibodies in contrast to 100% immunoprecipitation with anti-insulin-receptor antibodies. Anti-phosphotyrosine antibodies immunoprecipitated only 14 +/- 6% of NIDDM receptors (P less than .05 vs. nondiabetic receptors). A significant correlation existed between maximal insulin-stimulated receptor tyrosine kinase activity and the proportion of receptors immunoprecipitated by anti-phosphotyrosine antibodies (r = .76, P less than .01). These results suggest that human adipocytes contain two distinct receptor populations, both of which bind insulin but only one of which is capable of insulin-stimulated tyrosine phosphorylation. In nondiabetic subjects, 40-50% of the receptors that bind insulin are capable of insulin-stimulated tyrosine autophosphorylation. The proportion of receptors that bind insulin but are incapable of insulin-stimulated tyrosine autophosphorylation is increased in NIDDM; the magnitude of this increase correlated with the magnitude of the decrease in kinase activity.