The relative importance of insulin resistance and abnormal insulin secretion as risk factors for the development of non-insulin-dependent diabetes mellitus (NIDDM) is still controversial. Few data are available on insulin secretion as a risk factor for the development of NIDDM, especially in subjects with normal glucose tolerance. We examined the relation of fasting insulin (as a marker of insulin resistance) and the ratio of change in insulin to change in glucose during the first 30 min after glucose ingestion (delta I30/delta G30) (as a marker of insulin secretion) as predictors of the 7-year development of NIDDM in 714 initially nondiabetic Mexican-Americans. NIDDM developed in 99 subjects. The relative risk of NIDDM increased with higher quartiles of fasting insulin (quartile 1 [low], 1.0; quartile 2, 1.5; quartile 3, 2.0; and quartile 4 [high], 3.7; P < 0.0001) and lower delta I30/delta G30 (quartile 1 [low], 6.9; quartile 2, 1.9; quartile 3, 1.1; quartile 4 [high], 1.0; P < 0.001). Subjects with both increased fasting insulin and decreased delta I30/delta G30 had independent increases in NIDDM incidence (P < 0.001). Further, when we stratified subjects by baseline glucose tolerance, both increased fasting insulin and decreased delta I30/delta G30 significantly predicted NIDDM in subjects with both impaired and normal glucose tolerance at baseline. We conclude that both decreased insulin secretion (as assessed by low delta I30/delta G30) and increased insulin resistance (as assessed by fasting insulin) predict the development of NIDDM in Mexican-Americans, a group previously characterized as having hyperinsulinemia and insulin resistance.(ABSTRACT TRUNCATED AT 250 WORDS)