Aims/hypothesis. The provision of stable, reproducible basal insulin is crucial to diabetes management. This study in dogs examined the metabolic effects and interstitial fluid (ISF) profiles of fatty acid acylated insulin, Lys^B29-tetradecanoyl, des-(B30) human insulin (NN304). Methods. Euglycaemic clamps were carried out under inhalant anaesthesia during equimolar intravenous infusions (3.6 pmol · min^–1· kg^–1 for 480 min) of human insulin or NN304 (n = 8 per group). Results. Steady-state total NN304 (albumin-bound and unbound) was considerably higher in plasma compared with human insulin (1895 ± 127 vs 181 ± 10 pmol/l, p < 0.001) and increased in interstitial fluid (163 ± 14 vs 106 ± 9 pmol/l, p < 0.01). The halftime for appearance of NN304 in interstitial fluid was slower than human insulin (92 vs 29 min, p < 0.001). Yet, equivalency of action was shown for glucose turnover; steady-state glucose uptake (Rd) of 7.28 ± 0.55 and 6.76 ± 0.24 mg · min^–1· kg^–1 and endogenous glucose production of 0.11 ± 0.12 and 0.22 ± 0.03 mg · min^–1· kg^–1 (p > 0.40; NN304 and human insulin, respectively). Similar to interstitial fluid, half times for Rd and endogenous glucose production were delayed during NN304 infusion (162 vs 46 min and 80 vs 31 min, respectively; p < 0.01 vs human insulin). Conclusion/interpretation. Firstly equivalency of steady-state action is found at equimolar physiologic infusions of human insulin and NN304. Secondly NN304 binding to plasma albumin results in slower NN304 appearance in the interstitial compartment compared with human insulin. Thirdly the delay in appearance of NN304 in interstitial fluid may not in itself be a source of the protracted action of this insulin analogue. The protracted effect is due primarily to albumin binding of the insulin analogue NN304. [Diabetologia (1999) 42: 1254–1263]