Diabetes causes accelerated atherosclerosis and subsequent cardiovascular disease through mechanisms that are poorly understood. We have previously shown, using a porcine model of diabetes-accelerated atherosclerosis, that diabetes leads to an increased accumulation and proliferation of arterial smooth muscle cells in atherosclerotic lesions and that this is associated with elevated levels of plasma triglycerides. We therefore used the same model to investigate the mechanism whereby diabetes may stimulate smooth muscle cell proliferation. We show that lesions from diabetic pigs fed a cholesterol-rich diet contain abundant insulin-like growth factor-I (IGF-I), in contrast to lesions from non-diabetic pigs. Furthermore, two fatty acids common in triglycerides, oleate and linoleate, enhance the growth-promoting effects of IGF-I in smooth muscle cells isolated from these animals. These fatty acids accumulate predominantly in the membrane phospholipid pool; oleate accumulates preferentially in phosphatidylcholine and phosphatidylethanolamine, whereas linoleate is found mainly in phosphatidylethanolamine. The growth-promoting effects of oleate and linoleate depend on phospholipid hydrolysis by phospholipase D and subsequent generation of diacylglycerol. Thus, concurrent increases in levels of IGF-I and triglyceride-derived oleate and linoleate in lesions may contribute to accumulation and proliferation of smooth muscle cells and lesion progression in diabetes-accelerated atherosclerosis.