In type 2 diabetes, insulin activation of muscle glycogen synthase (GS) is impaired. This defect plays a major role for the development of insulin resistance and hyperglycemia. In animal muscle, insulin activates GS by reducing phosphorylation at both NH(2)- and COOH-terminal sites, but the mechanism involved in human muscle and the defect in type 2 diabetes remain unclear. We studied the effect of insulin at physiological concentrations on glucose metabolism, insulin signaling and phosphorylation of GS in skeletal muscle from type 2 diabetic and well-matched control subjects during euglycemic-hyperinsulinemic clamps. Analysis using phospho-specific antibodies revealed that insulin decreases phosphorylation of sites 3a + 3b in human muscle, and this was accompanied by activation of Akt and inhibition of glycogen synthase kinase-3alpha. In type 2 diabetic subjects these effects of insulin were fully intact. Despite that, insulin-mediated glucose disposal and storage were reduced and activation of GS was virtually absent in type 2 diabetic subjects. Insulin did not decrease phosphorylation of sites 2 + 2a in healthy human muscle, whereas in diabetic muscle insulin infusion in fact caused a marked increase in the phosphorylation of sites 2 + 2a. This phosphorylation abnormality likely caused the impaired GS activation and glucose storage, thereby contributing to skeletal muscle insulin resistance, and may therefore play a pathophysiological role in type 2 diabetes.