The insulin-regulated aminopeptidase (IRAP) is a member of the family of zinc-dependent membrane aminopeptidases. It is the homolog of the human placental leucine aminopeptidase (P-LAP). IRAP is expressed in different cell types but has been best characterized in two major insulin target cells, muscle and fat. In these cells IRAP localizes to intracellular membrane compartments under basal conditions. In response to insulin IRAP redistributes to the cell surface. IRAP shares this behavior with the insulin-responsive glucose transporter GLUT4. It is established that insulin's dramatic effect on glucose disposal is mediated through its action on GLUT4. The role IRAP plays in insulin action is unknown. IRAP cleaves several peptide hormones in vitro. In insulin-treated cells, concomitant with the appearance of IRAP at the cell surface, aminopeptidase activity toward extracellular substrates increases. Thus, insulin, by bringing IRAP to the cell surface, could increase the processing of extracellular peptide hormones and thereby change their activities. Investigations are underway to determine the in vivo substrates for IRAP and to measure the effect of insulin on the cleavage of identified substrates. In individuals with type 2 diabetes the insulin-stimulated translocation of IRAP to the cell surface of muscle and fat cells is impaired. This defect may lead to decreased cleavage and consequently increased action of peptide hormones that are substrates for IRAP. Impaired IRAP action may thus play a role in the development of complications in type 2 diabetes. The findings of decreased expression of GLUT4 and increased heart size in mice in which IRAP was deleted support this hypothesis.