Skeletal muscle insulin resistance develops in healthy subjects when plasma free fatty acids (FFA) are acutely increased to supraphysiological levels (~1,500 - 4,000 µmol/L). However, plasma FFA levels > 1,000 µmol/L are rarely observed in humans under usual living conditions and it is unknown whether insulin action/insulin signaling may be similarly impaired during a more sustained but physiologic increase in plasma FFA to levels seen in obesity and in type 2 diabetes mellitus (T2DM) (~600-800 µmol/L). It is also unclear if insulin-resistant non-diabetic subjects who are genetically predisposed to T2DM would respond to a low-dose lipid infusion as individuals without any family history of T2DM. To examine these questions, we increased plasma FFA within the physiologic range for 4 days in 7 normal glucose-tolerant subjects with a strong family history of T2DM (FH+) and 10 matched healthy controls (CON). Subjects were admitted twice to the CRC for 4 days and saline (SAL) or Liposyn (LIP; designed to increase plasma FFA by only ~1.5 fold) was infused in random order. On day 4, glucose turnover was measured with a euglycemic insulin clamp with 3 ³H-glucose combined with vastus lateralis muscle biopsies. Day-long plasma FFA concentration with LIP increased within the physiologic range, to levels seen in T2DM (mean 72-hour = 609 ± 82 µmol/L). Compared to CON, FH+ were markedly insulin resistant (Rd = 4.2 ± 0.5 vs. 8.0 ± 0.6 mg^.kgLBM^-1.min^-1, P < 0.01). During SAL, insulin signaling during insulin stimulation was markedly blunted in FH+ compared to CON: there was a 43% decrease in insulin-stimulated insulin receptor tyrosine phosphorylation (P < 0.05), a 15% reduction in IRS- 1 associated PI3-kinase activity (P < 0.05), and a 30% reduction in glycogen synthase (GS) activity (P < 0.03). Lipid infusion in CON reduced Rd by 25% (primarily non-oxidative glucose disposal) in association with reductions in insulin-stimulated insulin receptor tyrosine phosphorylation (17%), PI 3-kinase activity associated with IRS-1 (20%), and of insulin-stimulated GS fractional velocity over baseline (44% vs. 15%, all P < 0.05). In contrast to CON, a similar elevation in plasma FFA in FH+ led to no further deterioration in Rd, glucose oxidation or non-oxidative glucose disposal, or to any additional impairment of insulin signaling. In conclusion, a physiologic increase in plasma FFA for 4 days, to levels seen in obesity and T2DM, has discrepant effects in CON vs. FH+ subjects. It impairs insulin action/insulin signaling in CON but does not worsen insulin resistance in FH+. Whether the lack of an additional effect on insulin signaling by a chronic physiologic lipid infusion in FH+ is due to already well-established lipotoxicity, or to other biochemical/molecular mechanisms related to insulin resistance that are near maximally expressed early in life, remains to be determined.