We evaluated the effect of chronic (3 wk) subcutaneous treatment with progesterone and estradiol (PE; producing serum levels observed in the 3rd trimester of pregnancy) or placebo (C) on hepatic and whole body insulin sensitivity and response to hypoglycemia in conscious, overnight-fasted nonpregnant female dogs, using tracer and arteriovenous difference techniques. Insulin was infused peripherally for 3 h at 1.8 mU x kg(-1) x min(-1). Glucose was allowed to fall to 3 mM (Hypo) or maintained at 6 mM (Eugly) by peripheral glucose infusion. Insulin concentrations were significantly higher in Eugly-PE (n = 7) and Hypo-PE (n = 7) than in Eugly-C (n = 6) and Hypo-C groups (n = 7), but there were no significant differences in hepatic insulin extraction. Concentrations of glucagon, cortisol, epinephrine, and norepinephrine did not differ significantly between Eugly groups or between Hypo groups. Whole body glucose disposal, adjusted for the differences in insulin between groups, was 35% higher in Eugly-C vs. Eugly-PE groups (P < 0.05). Eugly-C and Eugly-PE groups exhibited similar rates of net hepatic glucose uptake, but the rate of glucose appearance was greater in Eugly-PE in the last hour (P < 0.05). Net hepatic glucose output was greater (P < 0.05) in Hypo-PE than in Hypo-C groups, and the glucose infusion rate required to maintain equivalent hypoglycemia was less (P < 0.05). The rate of gluconeogenic flux did not differ between Hypo groups. Chronic progesterone and estradiol exposure caused whole body (primarily skeletal muscle) insulin resistance and enhanced the liver's response to hypoglycemia without altering counterregulatory hormone concentrations.