The factors influencing the development of impaired sciatic motor nerve conduction velocity (MNCV) in acute experimental diabetes were examined. Decreased MNCV developed by the 14th day after streptozotocin administration but only in rats which became hyperglycemic. Insulin treatment, begun on day 3, failed to prevent imparied MNCV in diabetic rats in which improved or normal weight gain and a decreased degree of hyperglycemia was induced. However, insulin treatment prevented the development of impaired MNCV in a group of diabetic rats in which the tail vein plasma glucose concentration was never found to exceed 160 mg/dl during days 6 through 14, andin which the mean plus or minus SEM of the average plasma glucose concentration for each animal during the same period was 75 plus or minus 18 mg/dl. In normal rats fed diets containing 0.011% or 0.069% free myoinositol (a presumably normal range), sciatic nerve free myoinositol concentrations were 90- and 60-fold higher than those in plasma. On these diets the development of impaired MNCV in the diabetics was associated with a decrease in nerve free myoinositol as compared with nerves from normals fed the same diet, despite similar plasma levels in the normals and diabetics. Plasma and nerve free myoinositol increased with increasing dietary myoinositol content in both normals and diabetics, and nerve myoinositol content could be acutely increased by an i.p. myoinositol load. By supplementing the diets with 1.0% myoinositol, the difference in nerve myoinositol in normal and diabetic rats on day 14 was abolished; on this diet the development of impaired MNCV in the diabetics was moderated or totally prevented, despite persistent hyperglycemia and elevated nerve sorbitol and fructose concentrations. Insulin treatment that prevented impaired MNCV prevented a decrease in nerve myoinositol in diabetics. These studies suggest that insulin deficiency, and possibly hyperglycemia, are primary factors in the development of imparied MNCV in acute experimental diabetes. However, the development of impaired MNCV appears to be related in some manner to a derangement in the regulation of nerve free myoinositol content, which appears to be subject to modification by increases in plasma myoinositol concentration over a critical range.