Congenital malformations are the leading cause of the increased perinatal mortality in the infants of insulin-dependent diabetic mothers. The mechanisms(s) of diabetic teratologic development has yet to be defined. Hyperglycemia is known to depress aerobic metabolism in many organisms and cell lines. Reid hypothesized that exposure to hyperglycemia could result in decreased mitochondrial biogenesis in embryonic cells. Should these cells suddenly be changed to an environment of lower glucose concentration, decreased energy capabilities would exist until sufficient numbers of mitochondria could be regenerated. Such cells may not be capable of meeting temporal-spatial requirements, thereby resulting in structural abnormalities. In our study the explanted rat embryo model demonstrated that in the head-fold region hyperglycemia produced morphologic alterations of mitochondria but no difference in the number of mitochondria per cell. Specifically, embryos cultured in euglycemia demonstrated orthodox mitochondrial configuration, whereas those cultured in hyperglycemia had mitochondria in a condensed configuration. These findings were reversible. A modification of Reid's original hypothesis may provide an explanation for the mechanism of diabetic teratologic development.