Immune mediated complications associated with subcutaneous insulin therapy such as insulin neutralizing antibodies and/or skin reactions are rare conditions since human insulin is in general use. Nevertheless, if it occurs, a stepwise diagnostic approach is essential for differential diagnosis and consecutive treatment of these complications. Here we suggest a diagnostic algorithm to deal with e.g. insulin antibody formation of the IgG and/or IgE type and/or severe skin reactions resulting in poor metabolic control and often "brittle diabetes" in affected patients. This diagnostic algorithm includes step 1: Intradermal skin testing with positive and negative controls, additives and different insulin preparations; step 2: Quantification of insulin specific IgG and IgE in the serum, and step 3: Analysis of the time dependent binding/dissociation curves of the insulin neutralizing antibodies in an ex vivo/in vitro assay to assess the clinical significance of these antibodies. Based on 158 insulin treated control subjects and four patients with typical symptoms and signs representing the spectrum of immune-mediated complications subsequent to subcutaneous insulin therapy we demonstrate that the proposed stepwise approach leads to a definite diagnosis as a prerequisite for individual and successful therapy.