I tested the hypothesis that chronic hyperglycemia with secondary hyperinsulinemia inhibits the stimulation of fetal lung maturation by cortisol. Glucose was infused (16 +/- 2 mg/kg per min, mean +/- SE) from 112 through 130 d gestation into five chronically catheterised twin fetal lambs from which tracheal fluid could be collected. In addition, cortisol was infused (420 micrograms/h) from 128 through 130 d gestation into both the five glucose-treated twins and the five twin controls. Serum glucose (48 +/- 2 mg/dl) and insulin levels (45 +/- 3 microU/ml) were significantly higher in the glucose-treated fetuses than serum glucose (23 +/- 2 mg/dl, P less than 0.001) and insulin (15 +/- 3 microU/ml, P less than 0.001) in the controls. Serum cortisol levels were less than 2 micrograms/dl before 128 d gestation and rose to greater than 6 micrograms/dl, P less than 0.001 during cortisol infusion in both the glucose-treated and control fetuses. Cortisol treatment of control fetuses was associated with a 4.8-fold increase in surface active material (SAM) flux into tracheal fluid, and a 7.7-fold increase in total phospholipid content, a 9.5-fold increase in mixed lecithin content, a 10.5-fold increase in disaturated phosphatidylcholine content, and a 5.6-fold increase in phosphatidylglycerol content of the tracheal fluid (all P less than 0.001). In the glucose-treated fetuses there were no significant changes in the tracheal fluid SAM flux and phospholipid content following cortisol administration. In lung wash from the control fetuses treated with cortisol there was 8.9-fold more SAM, and on thin-layer chromatography there was 5.6-fold more total phospholipids, 3.9-fold more mixed lecithin, 6.2-fold more disaturated phosphatidylcholine, and 2.5-fold more phosphatidylglycerol when compared with lung wash from the glucose-treated fetuses treated with cortisol (all P less than 0.001). Lung volumes at maximal inflation pressure during air pressure-volume studies were 1.8-fold greater in the cortisol-treated control fetuses than in the glucose-treated fetuses, P less than 0.025. Chronic hyperglycemia with secondary hyperinsulinemia inhibits the maturational response of fetal lamb lungs to cortisol. A similar mechanism may operate in utero to increase the incidence of respiratory distress syndrome in infants of diabetic mothers with poor maternal glucose homeostasis. Moreover, on the basis of these data, prenatal treatment of infants of diabetic mothers with corticosteroids might not be expected to enhance fetal lung maturation.