Insulin resistance is predominantly characterized by decreased insulin-stimulated glucose uptake into skeletal muscle. In the current study, we have assessed various aspects of the phosphatidylinositol (PI) 3-kinase pathway in skeletal muscle biopsies obtained from normal, obese nondiabetic, and type 2 diabetic subjects, before and after a 5-h insulin infusion. We found a highly significant inverse correlation between in vivo insulin sensitivity (as measured by the glucose infusion rate) and increased protein expression of p85/55/50, protein kinase C (PKC)-theta activity, levels of pSer307 insulin receptor substrate (IRS)-1 and p-Jun NH2-terminal kinase (JNK)-1, and myosin heavy chain IIx fibers. Increased basal phosphorylation of Ser307 IRS-1 in the obese and type 2 diabetic subjects corresponds with decrease in insulin-stimulated IRS-1 tyrosine phosphorylation, PI 3-kinase activity, and insulin-induced activation of Akt and, more prominently, PKC-zeta/lambda. In summary, increased expression of the PI 3-kinase adaptor subunits p85/55/50, as well as increased activity of the proinflammatory kinases JNK-1, PKC-theta, and, to a lesser extent, inhibitor of kappaB kinase-beta, are associated with increased basal Ser307 IRS-1 phosphorylation and decreased PI 3-kinase activity and may follow a common pathway to attenuate in vivo insulin sensitivity in insulin-resistant subjects. These findings demonstrate interacting mechanisms that can lead to impaired insulin-stimulated PI 3-kinase activity in skeletal muscle from obese and type 2 diabetic subjects.