Islet amyloid polypeptide is a normal constituent of islet Beta cells and is derived from a larger precursor by removal of flanking peptides at the carboxy (C) and amino (N) terminals. The role of these flanking peptides in the formation of amyloid in Type 2 (non-insulin-dependent) diabetes mellitus and in insulinomas is unknown. The C-terminal flanking peptide of islet amyloid polypeptide was localised by immunocytochemistry in human and monkey pancreatic islets from Type 2 diabetic and non-diabetic individuals by use of specific polyclonal antisera. Immunoreactivity for the C-terminal peptide was found in insulin-containing cells in both diabetic and non-diabetic tissue: no antibody binding was detected in islet amyloid of Type 2 diabetic man or of monkeys although a positive reaction occurred with antisera for islet amyloid polypeptide. The C-terminal peptide was localised by immunogold electron microscopy in the insulin granules in both diabetic and nondiabetic individuals but, unlike islet amyloid polypeptide, was not detected in lysosomes. The absence of immunoreactivity for the C-terminal peptide in amyloid suggests that incomplete cleavage of this flanking peptide from islet amyloid polypeptide is not a factor in the formation of islet amyloid.