1. Patch-clamp recording techniques were used, to examine the effects of diazoxide on KATP currents in CRI-G1 insulin-secreting cells in the presence of non-hydrolysable nucleotides. 2. In the presence of non- or slowly-hydrolyzed ATP analogues, bathing the intracellular aspect of cell-free membrane patches diazoxide inhibited KATP channel activity. 3. Under whole-cell recording conditions, with various non-hydrolysable nucleotides present intracellularly (after dialysis), diazoxide induced KATP current activation. The largest activation occurred with Mg-adenylyl-(beta, gamma-methylene) diphosphate (Mg-AMP-PCP) present in the dialysing solution. This activation was diazoxide- and nucleotide-concentration-dependent. 4. In the absence of Mg2+, or in the presence of manganese (Mn2+) ions intracellularly, diazoxide did not induce KATP current activation, regardless of the species of nucleotide present in the pipette. 5. Intracellularly applied trypsin prevented the activation of KATP currents by diazoxide in the presence of Mg-AMP-PCP, an effect reversed by co-application of intracellular polymethylsulphonyl fluoride with the trypsin. 6. The application, by dialysis, of a CRI-G1 cell lysate, with negligible Mg-ATP, resulted in a substantial activation of the KATP current by diazoxide. 7. It is concluded that diazoxide can activate KATP channel currents by two separate pathways, one requiring a phosphorylation process, the other the presence of an intracellular protein coupled with a Mg-purine nucleotide.