Recent studies have demonstrated that C-peptide exerts beneficial effects on endothelial function. To investigate the relationship between residual pancreatic C-peptide secretion and endothelial function in patients with well controlled or poorly controlled Type II diabetes, we studied 100 patients with Type II diabetes that were free from diabetic neuropathy. In all patients, insulin resistance, residual pancreatic C-peptide secretion, endothelial function and oxidative stress were investigated using the homoeostasis model assessment (HOMA) index, glucagon bolus test, brachial reactivity, Trolox equivalent antioxidant capacity (TEAC) and thiobarbituric acid-reacting substances (TBARS). The patients were categorized into quartiles on the basis of plasma HbA(1c) (glycated haemoglobin) concentration. Analysis of the data showed significant increases in plasma glucose concentration, HOMA index, microalbuminuria and TBARS, and significant decreases in plasma C-peptide, AUC (area under the curve) plasma C-peptide and TEAC, through the different quartiles (from the lowest to the highest HbA(1c) concentration). With regard to parameters of endothelial function, changes in diameter showed a significant declining trend through the different quartiles. Endothelial-dependent changes in diameter were independently and significantly associated with AUC C-peptide levels, TEAC and TBARS. In conclusion, our study demonstrated that patients with Type II diabetes with good residual C-peptide secretion are better protected from endothelial dysfunction that those with poor C-peptide secretion.