Glucose intolerance and diabetes mellitus are both prevalent in cirrhosis, yet the pathogenesis of impaired glucose metabolism remains unknown. Therefore insulin secretion (hyperglycemic clamp, +125 mg/dl), insulin sensitivity (euglycemic hyperinsulinemic insulin clamp, +10 μU/ml and +50 μ/ml), whole-body glucose oxidation (indirect calorimetry) and glucose turnover ([6,6-2H2]glucose isotope dilution) were evaluated in a homogenous group of cirrhotic patients with glucose intolerance (n = 7) or frank diabetes mellitus (n = 6). The results were compared with those obtained in control subjects (n = 8). In glucose-intolerant patients, whole-body glucose uptake (mainly reflecting glucose utilization by muscle) was significantly impaired in patients during both insulin infusions as a result of decreased stimulation of the two major intracellular pathways of glucose disposal-nonoxidative glucose disposal (i.e., glycogen synthesis) and glucose oxidation. Hepatic glucose production was normal in the basal state and was normally suppressed during stepwise insulin infusion (by 65% and 85%, respectively, p = NS vs. controls). Hyperglycemia-induced increases of plasma C-peptide concentrations were comparable to those in controls (p = NS). In diabetic patients, insulin-mediated glucose uptake was significantly reduced, mainly because of impaired non-oxidative glucose disposal. Glucose oxidation appeared to be reduced, too. Hepatic glucose production was significantly increased in the basal state (3.03 ± 0.24 vs. 2.34 ± 0.10 mg/kg min, p < 0.02) and during insulin infusion ( +50 μ/ml: 0.67 ± 0.17 vs. 0.13 ± 0.08 mg/kg min, p < 0.05) compared with that in controls. Both the first and second phases of β-cell secretion were significantly reduced in response to steady-state hyperglycemia (both p < 0.01 vs. control values). In conclusion, glucose intolerance in cirrhosis results from two abnormalities that occur simultaneously: (a) insulin resistance of muscle and (b) an inadequate response (even when comparable to that of controls) of the β-cells to appropriately secrete insulin to overcome the defect in insulin action. Diabetes mellitus in insulinresistant cirrhotic patients develops as the result of progressive impairment in insulin secretion together with the development of hepatic insulin resistance leading to fasting hyperglycemia and a diabetic glucose tolerance profile. (Hepatology 1994;19:616–627).