The calpain-10 gene (CAPN10) has been implicated in type 2 diabetes (T2DM) susceptibility by both linkage and association in a Hispanic population from Starr County Texas. Common intronic variants seem to alter CAPN10 mRNA levels and were associated with insulin resistance but not diabetes in Pima Indians. The role of these variants in Caucasian populations is less clear. We found some evidence for linkage of T2DM to chromosome 2q approximately 20 cM proximal to the NIDDM1/CAPN10 locus. To test the hypothesis that CAPN10 is a diabetes susceptibility locus in Caucasian families at high risk for T2DM, we examined the influence of the three previously implicated CAPN10 variants on both diabetes risk and measures of insulin sensitivity and glucose homeostasis. We genotyped approximately 700 members of 63 families for 3 variants (SNP-43, SNP-19, and SNP-63). We tested each variant separately and as haplotype combinations for altered transmission from parents to affected children (transmission disequilibrium test), and we tested for an effect of each variant individually on measures of glucose and insulin during a glucose tolerance test in nondiabetic family members. Finally, we looked for an effect of each variant on measures of insulin sensitivity (S(I)) and insulin secretion estimated by frequently sampled iv glucose tolerance test and Minimal Model analysis. We could not confirm an increase in risk for T2DM susceptibility for any variant or for any haplotype combination, although we found marginal evidence for an increased risk of the 111/221 haplotype combination (P = 0.036) after ascertainment correction. However, both SNP-19 and SNP-63 increased fasting and/or postchallenge insulin levels, consistent with reduced insulin sensitivity. Furthermore, SNP-19 had modest effects on insulin sensitivity measured by homeostatic model, and on postchallenge glucose. The reduction in insulin sensitivity was confirmed by analysis of the subset of individuals who underwent iv glucose tolerance tests, where SNP-19 significantly altered the insulin sensitivity index. CAPN10 cannot be considered a major diabetes susceptibility gene in our population and seems unlikely to explain the observed linkage findings. However, CAPN10 influences insulin sensitivity and glucose homeostasis in nondiabetic members of kindreds at high risk for T2DM.