Insulin resistance (IR) is predictive of the development of non-insulin dependent diabetes mellitus (NIDDM) in Pima Indians, and this abnormality is associated with decreased rates of glycogen synthesis in skeletal muscle accompanied by a decreased activity of glycogen synthase and of its regulation enzyme complex, the glycogen bound type protein phosphatase (PP1). Glycogen-associated PP1 activity is determined by an isoform of the catalytic subunit complexed with the glycogen-targeting regulatory subunit, and the structural alterations of either component could result in the biochemical abnormalities observed in insulin resistant Pimas. Three genetically distinct PP1 catalytic subunit isoforms are known that may contribute to glycogen-bound PP1 activity (PP1 alpha, PP1 beta, and PP1 gamma) and we have previously determined the exon-intron structure of the genes coding for PP1 alpha (PPP1CA; 7 exons), PP1 beta (PPP1CB, 8 exons), PP1 gamma (PPP1CC, 7 exons), and PP1 regulatory G-subunit (PPP1R3, 4 exons) that we positioned on chromosome 7q. We found a common variant in the 3'-untranslated region (3'-UTR) of PPP1R3 that was associated with IR and NIDDM, and correlated with variations in PPP1R3 transcript and protein levels, causing a 10-fold difference in reporter mRNA half-life. Quantitative differences of the PPP1R3 products due to the 3'-UTR variant may therefore contribute to IR and NIDDM in the Pima Indians.