Recombinant human IGF-I (rhIGF-I) complexed with its natural binding protein IGF-binding protein (IGFBP)-3 (rhIGF-I/IGFBP-3) is a novel formulation that has been shown to improve insulin sensitivity in type 1 diabetes, yet the mechanisms are not clear. We used stable isotopes to investigate the effects of rhIGF-I/IGFBP-3 on glucose and glycerol metabolism in type 1 diabetes. Fifteen subjects (age 13–24 years; 10 males) were studied on three occasions in random order. Each study period lasted for two days, and an injection of either placebo or rhIGF-I/IGFBP-3 (0.1–0.8 mg · kg−1 · day −1) was given subcutaneously at 6:00 P.M. on days 1 and 2. Following the second injection, the subjects were kept euglycemic overnight by a variable rate insulin infusion, followed by a 4-h, two-step (insulin 0.6 and 1.5 mU · kg−1 · min −1) hyperinsulinemic-euglycemic clamp. During the overnight basal steady state, rhIGF-I/IGFBP-3 dose-dependently reduced endogenous glucose production rate (Ra) (P = 0.004), while peripheral glucose uptake (Rd) was not different from placebo. The increase in glucose Rd during hyperinsulinemic clamp was greater following rhIGF-I/IGFBP-3 than placebo, both during the first (P = 0.008) and second step (P = 0.008) of the clamp. No significant differences were found in glycerol Ra, a measure of lipolysis, between rhIGF-I/IGFBP-3 and placebo. In conclusion, rhIGF-I/IGFBP-3 enhances glucose metabolism by controlling both endogenous glucose output and peripheral glucose uptake.