We altered the cellular lipid composition of an insulin sensitive rat hepatoma cell line through supplementation of the culture medium with linoleic acid (18:2) or 25-hydroxycholesterol, and we studied the effects on insulin stimulation of aminoacid transport system A and glycogen synthesis. The basal rate of sodium-dependent aminoisobutyric acid uptake was slightly reduced in hydroxysterol-treated cells and increased in 18:2-enriched cells. Maximal insulin stimulation of transport was decreased by about 40% in both 18:2 and 25-hydroxycholesterol modified cells, as compared to control cells. In addition to reduced responsiveness, the hydroxysterol-treated cells also showed a diminished sensitivity to insulin, as revealed by a right-shift of the dose-response curve leading to a ED50 of 1.2 X 10(-8) M (P less than 0.02), as compared to 2.45 X 10(-9) M in control cells and 2.13 X 10(-9) M in 18:2 enriched cells. Concerning glycogen synthesis, the basal rate was unaffected by 25-hydroxycholesterol supplementation and slightly reduced in cells enriched in 18:2. Maximal insulin stimulation of glycogen synthesis was reduced by about 40% in both types of lipid modified cells. 25-Hydroxycholesterol again provoked a decrease in sensitivity to insulin: the ED50 was enhanced to 4.9 X 10(-9) M (P less than 0.05), as compared to 1.25 X 10(-9) M in control cells and 1.57 X 10(-9) M in 18:2-supplemented cells. Taken together with the previously reported changes of insulin binding to lipid modified hepatoma cells (Bruneau et al. (1987) Biochim. Biophys. Acta 928, 287-296) our results demonstrate an influence of alterations of the cellular lipid composition on both binding and biological actions of insulin, leading to an insulin-resistant state. Divergences between insulin binding and action were obtained and it was suggested that post-binding events may be responsible for the observed changes. Our findings may be relevant to experimental and clinical states of insulin resistance.