Diamide is reduced by mitochondria utilizing endogenous substrates with Vmax. 20nmol/min per mg of protein and Km 75micrometer. The reaction is inhibited by: (a) thiol-blocking reagents (N-ethylmaleimide, p-hydroxymercuribenzoate, mersalyl and 2,6-dichlorophenol-indophenol);(b) respiratory inhibitors (arsenicals, malonate and antimycin, but not cyanide or oligomycin; inhibition by antimycin is reversed by ATP); (c) uncouplers (carbonyl cyanide p-trifluoromethoxyphenylhydrazone, 2,4-dinitrophenol and valinomycin with K+; inhibition by the first of these uncouplers is not reversed by cyanide); (d) reagents affecting energy conservation (Ca2+, increasing pH, phosphate; phosphate inhibition is augmented by catalytic ADP or ATP and augmentation is abolished by respiratory inhibitors). Concentrations of mitochondrial glutathione are high when diamide reduction is uninhibited, but low after adding one of the above inhibitors such that the reduction rate is roughly proportional to the glutathione concentration. Endogenous ATP concentrations are lower in the presence of diamide than without, but the difference is abolished by respiratory inhibitors. With oligomycin added, however, ATP concentrations are higher in the presence of diamide and this positive increment is decreased by antimycin, N-ethylmaleimide and malonate. In the presence of diamide and an uncoupler, the mitochondrial glutathione content does not fall if various reducible substrates are present, although the inhibition of diamide reduction is not relieved. Some of these substrates prevent the fall in reduced glutathione concentration found with diamide and phosphate. They also relieve the inhibition of diamide reduction and the relief is sensitive to butylmalonate. The inhibition of diamide reduction by N-ethylmaleimide, mersalyl or p-hydroxymercuribenzoate is not relieved by reducible substrates, but the latter mitigate the fall in the concentration of glutathione. Inhibitors of carriers of tricarboxylic acid-cycle intermediates also inhibit reduction of diamide. The reduced glutathione concentration remains high when they are added singly, but falls when two of them are combined. It is proposed that diamide may enter the matrix as a protonated adduct formed with the thiol groups of mitochondrial carriers and then be reduced in the matrix by glutathione, which is regenerated via NADH, energy-dependent transhydrogenase and NADP+-specific glutathione reductase. Some of the high-energy equivalents required for the transhydrogeneration may be generated by the substrate phosphorylation step of the tricarboxylic acid cycle.