The aim of this study was to examine the mechanisms by which dietary carbohydrate and fat modulate fasting glycemia. We compared the effects of an eucaloric high-carbohydrate (89% carbohydrate) and high-fat (89% fat) diet on fasting glucose metabolism and insulin sensitivity in seven obese patients with type 2 diabetes using stable isotopes and euglycemic hyperinsulinemic clamps. At basal insulin levels glucose concentrations were 148 +/- 11 and 123 +/- 11 mg/dl (8.2 +/- 0.6 and 6.8 +/- 0.6 mmol/liter) on the high-carbohydrate and high-fat diet, respectively (P < 0.001), with insulin concentrations of 12 +/- 2 and 10 +/- 1 microIU/ml (82 +/- 11 and 66 +/- 10 pmol/liter) (P = 0.08). Glucose production was higher on the high-carbohydrate diet (1.88 +/- 0.06 vs. 1.55 +/- 0.05 mg/kg.min (10.44 +/- 0.33 vs. 8.61 +/- 0.28 micromol/kg.min) (P < 0.001) because of higher glycogenolysis. Gluconeogenic rates were not different between the diets. During the use of hyperinsulinemic euglycemic clamps, insulin-mediated suppression of glucose production and stimulation of glucose disposal were not different between the diets. Free fatty concentrations were suppressed by 89 and 62% (P < 0.0001) on the high-carbohydrate and high-fat diet, respectively. We conclude that short-term variations in dietary carbohydrate to fat ratios affect basal glucose metabolism in people with type 2 diabetes merely through modulation of the rate of glycogenolysis, without affecting insulin sensitivity of glucose metabolism.