Insulin controls or alters glucose, protein, and fat metabolism as well as other cellular functions. Insulin binds to a specific receptor on the cell membrane initiating a protein phosphorylation cascade that controls glucose uptake and metabolism and long-term effects such as mitogenesis. This process also initiates insulin uptake and ultimate cellular metabolism in all insulin sensitive cells. The effects of insulin on other cellular metabolic properties have not been clearly related to this mechanism. Here we show that intracellular metabolism of insulin may be related to some aspects of insulin actions, specifically control of fat metabolism. A normal intracellular degradation product of insulin has been synthesized and tested for actions on fat turnover in cultured adipocytes. This 7-peptide, B-chain fragment (HLVEALY) inhibits both basal and stimulated lipolysis as measured by glycerol release, but does not inhibit FFA release because of a lack of effect on FFA reesterification in the adipocyte. HLVEALY also enhances insulin's effects on lipogenesis. This study shows that a fragment of insulin produced by the action of the insulin-degrading enzyme has both independent biological effects and interactions with insulin. This supports a biologically important effect of insulin metabolism and insulin degradation products on insulin action on non-glucose pathways. Published by Elsevier Inc.