Although chromium is an essential element for carbohydrate and lipid metabolism, its effects in diabetic patients are still debated. We have studied the effect of 6 week treatment with chromium picolinate (8 microg/ml in drinking water) in streptozotocin (STZ)-induced type 1 and type 2 diabetic rat models. The mechanism of anti-diabetic action of chromium picolinate was studied using C2C12 myoblasts and 3T3-L1 adipocytes. Chromium picolinate significantly decreased the area under the curve over 120 min for glucose of both STZ-induced type 1 (40mg/kg, i.v. in adult rats) and type 2 (90 mg/kg, i.p. in 2 day old rat neonates) diabetic rats without any significant change in area under the curve over 120 min for insulin as compared to controls. The composite insulin sensitivity index and insulin sensitivity index (KITT) values of both type 1 and type 2 diabetic rats were increased significantly by chromium picolinate. Treatment with chromium picolinate produced a significant decrease in elevated cholesterol and triglyceride levels in both types of diabetic rats. In 3T3-L1 adipocytes, chromium picolinate (0-10 micromol) per se did not produce any effect, however, when co-incubated with insulin it significantly increased the intracellular triglyceride synthesis (EC50 = 363.7nmol/1). Similarly in C2C12 myoblasts, chromium picolinate alone did not produce any effect, however, it significantly increased insulin-induced transport of 14C-glucose. In conclusion, chromium picolinate significantly improves deranged carbohydrate and lipid metabolism of experimental chemically induced diabetes in rats. The mechanism of in vivo anti-diabetic action appears to be peripheral (skeletal muscle and adipose tissue) insulin enhancing action of chromium.