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NIDDM is characterized by islet amyloid deposits and decreased beta-cell mass. Islet amyloid is derived from the locally expressed protein islet amyloid polypeptide (IAPP). While it is now widely accepted that abnormal aggregation of IAPP has a role in beta-cell death in NIDDM, the mechanism remains unknown. We hypothesized that small IAPP aggregates, rather than mature large amyloid deposits, are cytotoxic. Consistent with this hypothesis, freshly dissolved human (h)-IAPP was cytotoxic when added to dispersed mouse and human islet cells, provoking the formation of abnormal vesicle-like membrane structures in association with vacuolization and cell death. Human islet cell death occurred by both apoptosis and necrosis, predominantly between 24 and 48 h after exposure to h-IAPP. In contrast, the addition to dispersed islet cells of matured h-IAPP containing large amyloid deposits of organized fibrils was seldom associated with vesicle-like structures or features of cell death, even though the cells were often encased in the larger amyloid deposits. Based on these observations, we hypothesized that h-IAPP cytotoxicity is mediated by membrane damage induced by early h-IAPP aggregates. Consistent with this hypothesis, application of freshly dissolved h-IAPP to voltage-clamped planar bilayer membranes (a cell-free in vitro system) also caused membrane instability manifested as a marked increase in conductance, increased membrane electrical noise, and accelerated membrane breakage, effects that were absent using matured h-IAPP or rat IAPP solutions. Light-scattering techniques showed that membrane toxicity corresponded to h-IAPP aggregates containing approximately 25-6,000 IAPP molecules, an intermediate-sized amyloid particle that we term intermediate-sized toxic amyloid particles (ISTAPs). We conclude that freshly dissolved h-IAPP is cytotoxic and that this cytotoxicity is mediated through an interaction of ISTAPs with cellular membranes. Once ISTAPs mature into amyloid deposits comprising >10(6) molecules, the capacity of h-IAPP to cause membrane instability and islet cell death is significantly reduced or abolished. These data may have implications for the mechanism of cell death in other diseases characterized by local amyloid formation (such as Alzheimer's disease).