Phenformin-induced lactic acidosis has been thought to be rare in India due to a high carbohydrate intake, use of suboptimal doses of phenformin and a lesser prevalence of alcoholism, as compared to Western countries. We studied the blood lactate levels of 31 non-insulin dependent diabetics (Group A) before and after treatment with phenformin, 75 mg/day for 4 weeks. Blood lactate rose significantly after treatment (mean +/- SEM 16.6 +/- 1.2 mg/dl to 30.7 +/- 2.2; p less than 0.01). Seven patients from this group had blood lactic acid level greater than 72 mg/dl. Six of these patients were restudied off treatment and after 4 weeks of phenformin therapy. The arterial blood pH, pCO2, pO2 and bicarbonate remained unchanged on treatment although a significant rise in blood lactic acid was reconfirmed in these 6 patients. Another group of 12 patients on phenformin for more than six months had significantly lower blood lactate levels as compared to group A (mean +/- SEM 20.2 +/- 1.8 mg/dl vs 30.7 +/- 2.2 mg/dl; p less than 0.01) indicating the possibility of a process of adaptation on prolonged treatment. This possibility was confirmed by a serial follow-up study of 11 patients for a 6 month period on phenformin therapy. A case of biguanide-induced lactic acidosis diagnosed and treated by us is described.