T o assess the mechanisms for the elevation of free fatty acids in noninsulin-dependent diabetes, free fatty acid metabolism and lipid and carbohydrate oxidation were compared in 14 obese diabetic Pima Indians and in 13 age-, sex-, and weight-matched nondiabetics. The studies were repeated in 10 of the diabetics after 1 mo of oral hypoglycemic therapy. Fasting plasma glucose concentrations were elevated in diabetics (242 +/- 14 vs. 97 +/- 3 mg/dl, P less than 0.01) and decreased to 142 +/- 12 (P less than 0.01) after therapy. Fasting free fatty acid concentrations were elevated in diabetics (477 +/- 26 vs. 390 +/- 39 mumol/liter, P less than 0.01) and declined to normal values after therapy (336 +/- 32, P less than 0.01). Although free fatty acid transport rate was correlated with obesity (r = 0.75, P less than 0.001), the transport of free fatty acid was not higher in diabetics than in nondiabetics and did not change after therapy. On the other hand, the fractional catabolic rate for free fatty acid was significantly lower in untreated diabetics (0.55 +/- 0.04 vs. 0.71 +/- 0.06 min-1, P less than 0.05); it increased after therapy to 0.80 +/- 0.09 min-1, P less than 0.05, and was inversely correlated with fasting glucose (r = -0.52, P less than 0.01). In diabetics after therapy, lipid oxidation rates fell significantly (from 1.35 +/- 0.06 to 1.05 +/- 0.01 mg/min per kg fat-free mass, P less than 0.01), whereas carbohydrate oxidation increased (from 1.21 +/- 0.10 to 1.73 +/- 0.13 mg/min per kg fat-free mass, P less than 0.01); changes in lipid and carbohydrate oxidation were correlated (r = 0.72, P less than 0.02), and in all subjects lipid oxidation accounted for only approximately 40% of free fatty acid transport. The data suggest that in noninsulin-dependent diabetics, although free fatty acid production may be elevated because of obesity, the elevations in plasma free fatty acid concentrations are also a result of reduced removal, and fractional clearance of free fatty acid appears to be closely related to diabetic control. Furthermore, the increase in fractional clearance rate, despite a marked decrease in lipid oxidation, suggests that the clearance defect in the diabetics is due to an impairment in reesterification, which is restored after therapy.