To study the pathways involved and the effect of insulin on the autoregulation of hepatic glucose balance, isolated hepatocytes from normal, diabetic and treated diabetic rats were incubated with varying concentrations of glucose (100-400 mg/dl) with and without pyruvate (10 mM). New glucose production or utilization was calculated from the change in media glucose concentrations before and after incubation, new glycogenolysis by the change in tissue glycogen levels before and after incubation, net glycolysis by following the incorporation of glucose-C14 into lactate C14 and gluconeogenesis by the difference in glucose production in the presence and absence of pyruvate. Hepatocytes from control and insulin-treated animals manifested autoregulation of glucose balance. Glucose modulated the glycogen and glycolytic pathways but did not affect gluconeogenesis. In hepatocytes from diabetic rats, there was no autoregulation, tissue glycogen was unmeasurable both before and after incubation, glycolysis was markedly curtailed and gluconeogenesis was increased. It may be concluded that (1) glucose autoregulates its own production or utilization by modulating the glycogen and glycolytic pathways, (2) autoregulation is lost in severe diabetes leading to fasting hyperglycemia, and (3) insulin has a permissive effect on the autoregulation of glucose balance by maintaining the rate-limiting enzymes, glycogen synthase and glucokinase, so that glucose can exert its effect on these pathways.