Poorly controlled insulin dependent diabetics showed impaired E-rosette forming ability compared to sex and age matched normal controls (34.8 + 3.1, n = 31 vs 55.5 _+ 1.7, n = 33; p < 0.001; mean + SEM). The reduction of E-rosette cells % was not related to the duration of diabetes, nor to fasting blood glucose levels. Incubation of lymphocytes from a subsequent series of 17 insulindependent diabetics with insulin (100 ~tU/ml) plus glucose (100 mg/100 ml) significantly increased Erosette formation (37.6 _+ 3.3 vs 47.0 _+ 2.2; p = 0.01); conversely glucagon (0.1 ~tg/ml) significantly impaired E-rosette forming ability of normal lymphocytes (51.5 + 3.6 vs 44.5 + 4.2; n-17; p < 0.01). No difference was observed in cAMP content of normal and diabetic lymphocytes, nor was Erosette forming ability related to intracellular cAMP content. Incubation with increasing glucose concentrations (up to 500mg/100ml) did not affect Erosette forming ability of normal lymphocytes. Incubation of normal lymphocytes with diluted (1:10) serum from sex and age matched insulin dependent diabetics impaired E-rosette forming ability to the level found in diabetics (61.1 + 2.9 vs 39.7 _+ 4.4; p < 0.001). The results of these in vitro experiments show that insulin and glucagon exhibit opposite effects on E-rosette forming ability and that undefined factor(s) present in diabetic serum may affect this T-cell function.