The relationship between the growth hormone independent insulin-like growth factor binding protein (BP-28) and serum insulin-like growth factor-I (IGF-I) inhibitory bioactivity observed in diabetic serum was investigated in five poorly controlled adolescent type I diabetics. We have measured the in-vitro effects of purified BP-28 from amniotic fluid on serum IGF-I stimulated and basal cartilage sulphation and compared serum IGF-I bioactivity obtained from 24-h serum profiles from each diabetic subject with serum concentrations of BP-28 and IGF-I measured by specific radioimmunoassays. Purified BP-28 inhibited serum IGF-I stimulated and basal cartilage sulphation in vitro, in a dose-dependent manner. Serum IGF-I bioactivity of diabetic sera showed a change in activity over the 24-h period, with peak inhibitory bioactivity observed in each subject between 0800 and 1000 h. BP-28 concentrations in each individual showed a marked circadian rhythm with maximum peak levels occurring at 0800 h. Long-acting insulin administered in the evening in two of the diabetic subjects blunted the maximum peak level attained compared to the three diabetics who had long-acting insulin administered in the morning. IGF-I concentrations did not change over the 24-h period in each individual. The data shows that BP-28 inhibits serum IGF-bioactivity on cartilage in vitro. The changes in inhibitory bioactivity observed in diabetic serum are associated with similar changes in serum concentrations of BP-28. We propose that BP-28 is one of the IGF-I inhibitors observed in diabetic serum and that it may play a role in retarded growth and delayed puberty often seen in the adolescent diabetic.