Several in vitro studies have suggested that nitric oxide may be the mediator of cytokine-induced beta-cell destruction. On the other hand, in vivo studies have given conflicting results: some studies suggesting that nitric oxide synthase inhibitors do not suppress streptozotocin-induced diabetes in mice, while others revealed that nitric oxide synthase inhibitors can reduce the incidence of insulin-dependent diabetes mellitus in rats. The results of the present study indicate that alloxan-induced diabetes in the male Wistar rats can be abrogated to a large extent by prior and simultaneous administration of the precursor of nitric oxide, L-arginine, where as NG-monomethy-L-arginine (L-NMMA), a specific inhibitor of nitric oxide synthase, can completely block the beneficial action of L-arginine. Sodium nitroprusside, a nitric oxide donor, also showed significant inhibitory effect on the severity of diabetes induced by alloxan. Alloxan treatment reduced nitric oxide generation, whereas L-arginine and sodium nitroprusside, when given along with alloxan, enhanced nitric oxide production to control values. Induction of diabetes by alloxan in the experimental animals was associated with a marked elevation in plasma lactate, ketone body, and lipid peroxide levels with a simultaneous fall in plasma insulin and nitric oxide levels. Alloxan-induced diabetes also induced a fall in the levels of anti-oxidant enzymes such as superoxide dismutase, glutathione reductase, and total glutathione, and antioxidants: vitamin E and ceruloplasmin, and an increase in glutathione peroxidase and glutathione-S-transferase. All these biochemical abnormalities and antioxidant levels have improved to near normal levels in animals treated with insulin, L-arginine, and sodium nitroprusside. From the results of the present study, it is apparent that L-arginine and nitric oxide can prevent alloxan-induced beta-cell damage, and the development of diabetes, and restore the antioxidant status to near normal levels.