Poorly controlled insulin dependent diabetics showed impaired E-rosette forming ability compared to sex and age matched normal controls (34.8±3.1, n=31 vs 55.5±1.7, n=33; p< 0.001; mean±SEM). The reduction of E-rosette cells % was not related to the duration of diabetes, nor to fasting blood glucose levels. Incubation of lymphocytes from a subsequent series of 17 insulin-dependent diabetics with insulin (100 U/ml) plus glucose (100 mg/100 ml) significantly increased E-rosette formation (37.6±3.3 vs 47.0±2.2; p= 0.01); conversely glucagon (0.1 g/ml) significantly impaired E-rosette forming ability of normal lymphocytes (51.5±3.6 vs 44.5±4.2; n=17; p< 0.01). No difference was observed in cAMP content of normal and diabetic lymphocytes, nor was E-rosette forming ability related to intracellular cAMP content. Incubation with increasing glucose concentrations (up to 500mg/100ml) did not affect E-rosette forming ability of normal lymphocytes. Incubation of normal lymphocytes with diluted (110) serum from sex and age matched insulin dependent diabetics impaired E-rosette forming ability to the level found in diabetics (61.1 ± 2.9 vs 39.7 ± 4.4; p < 0.001). The results of these in vitro experiments show that insulin and glucagon exhibit opposite effects on E-rosette forming ability and that undefined factor(s) present in diabetic serum may affect this T-cell function.