Pioglitazone increases insulin sensitivity in vivo and in vitro. The effects of this agent on insulin-induced DNA synthesis and hepatic cell growth have not been determined. We examined the ability of pioglitazone to enhance basal and insulin-stimulated DNA synthesis in rat H4IIE (H4) hepatoma cells, and to alter liver weight and histology in diabetic KKAy mice. Treatment of H4 cells with increasing concentrations of pioglitazone for 30 h increased basal DNA synthesis 1.6- to 1.8-fold. With pioglitazone pretreatment and submaximal insulin concentrations, DNA synthesis was significantly increased from 2.1-fold (insulin 10(-12) mol/l alone) to 3.9-fold (insulin 10(-12) mol/l + pioglitazone 10(-6) mol/l). At maximal concentrations of insulin, the enhancement of DNA synthesis increased from 7.4-fold (insulin 10(-8) mol/l alone) to 16.2-fold (insulin 10(-8) mol/l + pioglitazone 10(-6) mol/l). Glyburide did not increase basal or insulin-stimulated DNA synthesis. In diabetic KKAy mice, serum glucose levels decreased and body weight, liver weight and liver weight as a percentage of body weight increased following pioglitazone treatment. Histological studies demonstrated marked hepatocyte distension. Our findings suggest that pioglitazone acts as an insulin sensitizer in rat hepatoma cells, increasing basal and insulin-stimulated DNA synthesis, and stimulating fat synthesis and liver hypertrophy in diabetic KKAy mice.