Impaired course of inflammation is a likely mechanism behind a number of diabetic complications. The present study was undertaken to investigate lipopolysaccharide-induced production of tumour necrosis factor (TNF)-alpha in monocytes from patients with type 2 diabetes and to assess its relationship with diabetes-associated metabolic abnormalities. Monocytic TNF-alpha mRNA production was lower in the diabetic participants compared to their corresponding controls. Diabetic subjects who had been receiving simvastatin treatment had TNF-alpha mRNA production similar to that of the healthy participants. The release of TNF-alpha from diabetic cells correlated negatively with serum levels of apolipoprotein B (apoB) (R = -0.755, P = 0.001), total plasma cholesterol (R = - 0.702, P = 0.002) and the presence of retinopathy (R = -0.572, P = 0.021). No such associations were found in the control subjects. In a multiple linear regression model, only the level of apoB and diabetes duration demonstrated significant effects on the release of TNF-alpha, with apoB alone accounting for 57% of the variation. We conclude that production of TNF-alpha mRNA in response to the bacterial stimulant is compromised in poorly controlled type 2 diabetes. Lipid abnormalities are associated with the observed defect. Impaired cytokine production represents a significant defect in the functioning of the immune system and may contribute to aberrations in the course of inflammation in the diabetic state.