An in vitro assay for insulin action on hepatocytes is described. The ¹²⁵I-insulin binding and the effects of insulin on net ¹⁴C-glucose incorporation into glycogen were studied in suspensions of isolated hepatocytes from fed, 250 gram adult rats. Insulin doubled the basal value (mean ± SEM) of 9.0 ± 1.0 nmoles glucose/10⁶ cells/hr with a one-half maximal concentration of 3 ng/ml (75 μU/ml) and a maximum effect between 10 and 20 ng/ml (250 μU/ml). Insulin binding was half-maximal at 40 ng/ml and maximal between 100 and 300 ng/ml. Thus, maximal stimulation occurred at approximately 35% of maximum binding implying that hepatocytes have spare receptors for insulin action on net incorporation of ¹⁴C-glucose into glycogen. This assay was then used to investigate the time course of activation of insulin action. Isolated hepatocytes were preincubated at 37°C in the presence or absence of 40 ng/ml of insulin for 2, 15, or 30 min, washed, and then tested for action in fresh insulin-free media containing ¹⁴C-glucose. No activation was seen after 2 min, a partial activation after 15 min and maximum activation was seen only after a 30 min preincubation. Therefore, insulin activation of glucose incorporation into glycogen in liver is a time-dependent phenomenon that is reversible by early dissociation.