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1. An in vitro system is described in which insulin beta-granule-plasma membrane interaction can be studied. 2. The system shows an absolute requirement for physiological amounts of Ca2+ (2 muM) in order for insulin release to proceed. 3. ATP (5 muM) is abot to augment the Ca2+ effect. 4. Glucose (17 mM) alone does not cause insulin release but in the presence of Ca2+ is as effective as ATP. 5. When glucose, ATP and Ca2+ are added together a positive cooperative effect is produced with over 85% of the total insulin, added in the form of beta-granules, being released into the medium in 10 min. 6. The system responds to tolbutamide, in the presence of Ca2+ and ATP, by releasing insulin. 7. Diazoxide, a potent insulin inhibitor in vivo, demonstrates a similar activity in vitro. 8. Various control experiments utilizing alternative membranes, granules, nucleotides, sugars and phosphorylated intermediates of metabolism have all reinforced the specificity of the release mechanisms. 9. These results demonstrate that the in vitro system mimics responses found in the intact organism and can be utilized to dissect the mechanisms associated with exocytosis of insulin granules. 10. Preliminary experiments utilizing adrenaline granules-adrenal plasma membranes and pituitary granules-pituitary plasma membranes suggest that the in vitro system can be extended to all granule secreting processes.