We have shown that elevated plasma D-glucose levels in experimentally-induced diabetic nude athymic rats can be reduced by intraperitoneal transplantation of microcarrier-attached insulin producing beta cells from the mouse pancreatic beta cell line, beta TC-1. The reduction in the level of hyperglycemia was observed as early as two days following cell transplantation and was associated with a concomitant increase in plasma insulin levels. beta TC-1 cell transplanted diabetic rats had plasma D-glucose levels similar to those found in non-diabetic control animals and remained normoglycemic throughout the 39 day experimental period. The beta TC-1 cell transplanted diabetic rats also had near normalization of body weight, food and water intake and of urine output when compared to control diabetic and non-diabetic rats. Similarly, they exhibited improved blood glucose clearance following intravenous D-glucose administration. These results suggest that beta TC-1 cells regulate D-glucose homeostasis following transplantation into diabetic rat recipients in a manner similar to that of endogenous pancreatic beta cells.