BACKGROUND Insulin resistance has been associated with hypertension and with renal complications in patients with type 1 diabetes mellitus. Causal relationships have not been fully explained. METHODS We investigated whether insulin resistance precedes microalbuminuria by measuring insulin resistance with a euglycaemic clamp in combination with indirect calorimetry in 16 uncomplicated type 1 diabetic patients and in six healthy control subjects. The patients had over 10 year duration of diabetes, and were expected to experience either a complication-free or complicated disease course within the next few years. They have thereafter been followed for the development of microalbuminuria for 3 years. RESULTS In a euglycaemic insulin clamp glucose disposal was lower in diabetic patients compared with control subjects (7.5 +/- 2.9 and 12.6 +/- 2.0 mg/kg LBM/min; P<0.002), mainly due to impaired glucose storage (4.3 +/- 2.3 vs 8.6 +/- 1.6 mg/kg LBM/min; P<0.001). Three years later seven IDDM patients had albumin excretion rate over 30 mg/24 h; glucose disposal (5.5 +/- 2.1 vs 9.0 +/- 2.2 mg/kg LBM/min; P<0.01) had been lower in patients who developed microalbuminuria compared with those who remained normoalbuminuric. CONCLUSIONS Insulin resistance predicts the increment in urinary albumin excretion. Insulin resistance depends mainly on impaired glucose storage in uncomplicated IDDM.