Evidence has emerged that proinsulin C-peptide has at least three types of functional interactions in addition to its role during synthesis and secretion of insulin. Thus, C-peptide has been shown (i) to bind to cell membranes triggering G-protein-mediated intracellular signaling; (ii) to be internalized into cells and nuclei promoting transcription of rRNA and expression of particular genes; and (iii) to interact with peptides, including insulin, causing desaggregation of insulin oligomers like a chaperone, and with itself, causing homo-oligomers potentially capable of forming aggregates and deposits. In this work, we studied the insulin-C-peptide interactions by monitoring desaggregation and binding effects of C-peptide fragments on insulin. We find that the N-terminal segment of C-peptide harbors an interaction with insulin and that Glu11 appears to play a role in this action. We conclude that C-peptide fragments with this residue can mimic C-peptide in biophysical interactions with insulin, and that the insulin-interacting and membrane-interacting effects of C-peptide are distinct, ascribable to separate C-peptide segments, Nand C-terminally, respectively. The findings may have relevance to peptide effects in diabetic and healthy states. (C) 2010 Elsevier Inc. All rights reserved.