It is well known that, in diabetes, there is an abnormality of both pancreatic beta and alpha cell secretion. Since islet transplantation can markedly improve the diabetic state in streptozotocin-treated rats, we investigated the effects of intraportal transplantation on the beta and alpha cell secretion of the transplanted tissue. In addition we examined the effects of transplantation on the hormone content of both the transplanted tissue and the endogenous pancreas. Animals were examined 6 and 20 wk after transplantation. Isolated perfusions of the perfusions of the islet-containing livers showed that both glucagon and insulin secretion could be promptly stimulated by arginine. The hormone content of the livers at death revealed that, while the insulin content of transplanted tissue was well maintained, there was a marked reduction in glucagon content. An increase in pancreatic glucagon content was found in rats with untreated diabetes of five months' duration; this was partially or fully prevented by islet transplantation. There was also a moderate increase in insulin content of the pancreases of animals that received islet transplants.