1. In streptozotocin-induced diabetic male rats, hepatic microsomal aminopyrine N-demethylase activity was depressed, whereas aniline hydroxylase activity and cytochrome P-450 content were increased over control values. 2. In diabetic female rats, hepatic microsomal aminopyrine N-demethylase activity, aniline hydroxylase activity, biphenyl 4-hydroxylase activity, and cytochrome P-450 content were increased over control values. 3. Insulin treatment of diabetic male and female rats antagonized all physical and biochemical abnormalities of the diabetic state; 4. Methyl analogues of streptozotocin did not produce a diabetic state when injected into female rats, and resulted in no changes in aminopyrine N-demethylase activity, aniline hydroxylase activity, or cytochrome P-450 content. 5. Insulin treatment of non-diabetic female rats resulted in slight decreases in aminopyrine N-demethylase and aniline hydroxylase activities, but no changes in cytochrome P-450 content. These observations suggest that insulin primarily influences drug metabolism of diabetic animals through correction of the insulin-deficient diabetic state.