Insulin action on fat cell/skeletal muscle glucose transporter (GLUT4) redistribution to cell surface membranes appears to involve small GTP-binding proteins. It has been recently recognized that at least two GDP dissociation inhibitor (GDI) isoforms, GDI-1 and GDI-2, can bind and release GDP-bound Rab proteins from membranes (Shisheva, A., Sudhof, T.C., and Czech, M. P. (1994) Mol. Cell. Biol. 14, 3459-3468). The present studies show that a strikingly higher level of GDI-2 fractionates with total membranes of COS-1 cells, Chinese hamster ovary cells, and 3T3-L1 adipocytes compared to GDI-1, which is virtually totally cytosolic. In 3T3-L1 adipocytes, most of the membrane-bound GDI-2 was present in a low density, intracellular membrane fraction. Immunodepletion of GLUT4-enriched vesicles from this membrane fraction also depleted significant amounts of GDI-2 proteins. Localization of both GDI-2 and GLUT4 in the same perinuclear regions of these cells was established by immunofluorescence microscopy, whereas GDI-1 displayed a diffuse, cytoplasmic distribution. Insulin acutely decreased both GLUT4 and GDI-2 protein levels in the low density microsomes by about 50%. Concomitantly, GLUT4 but not GDI-2 protein content of plasma membranes increased, suggesting release of GDI-2 into the cytoplasm in response to insulin. Taken together, these data suggest functional differences for the GDI-1 and GDI-2 protein isoforms, as well as a potential role of GDI-2 in the action of insulin on membrane movements.