Elevated levels of plasma triglycerides (TG) and reduced concentrations of HDL cholesterol are very common in patients with diabetes, particularly NIDDM. Although regulation of the plasma concentrations of VLDL, the major TG-rich lipoprotein is extremely complex, it is clear from in vivo kinetic studies that increased rates of secretion of VLDL into plasma is almost uniformly present in patients with NIDDM and hypertriglyceridemia. Recent studies at the cellular level indicate that increased fatty acid flux to the liver, also common in NIDDM (and other insulin-resistant states associated with elevated plasma TG levels), will stimulate the assembly and secretion of apoprotein (apo) B-containing lipoproteins by targeting apoB for secretion rather than intracellular degradation. Increased rates of secretion of VLDL into plasma appears to drive the exchange of TG from these lipoproteins for HDL cholesteryl ester. This exchange, which occurs in plasma, is facilitated by cholesteryl ester transfer protein, and generates a TG-enriched HDL that is a substrate for either hepatic lipase or lipoprotein lipase. When the TG in HDL is hydrolyzed, the resultant particle is smaller, and this appears to affect the binding of the major HDL protein, apoA-I. ApoA-I dissociates from the smaller, lipid-poor HDL, and the free apoA-I (molecular weight 28,000) can be filtered by the glomerulus in the kidney and most likely is degraded in renal tubular cells after reabsorption. Thus, increased free fatty acid transport in plasma, a common abnormality in insulin-resistant states, may be the underlying driving force for the two common lipid abnormalities seen in diabetes.