Muscular exercise leads to hypoglycemia. The ‘glucose transport theory’ of insulin action places cellular entry of glucose as the limiting step in its rate of metabolism at rest as well as under exercise. Activation of entry of appropriate sugars by exercise, as a primary event, leads to the augmented rates of glucose metabolism seen with contraction of muscles. The mechanism of hypoglycemia of exercise is shown to be humoral in character. Blood and lymphatic fluid of working dogs, both normal or diabetic, are shown to develop hypoglycemic properties during exercise which can be transferred to resting preparations. This hypoglycemic factor of muscle work is highly labile and appears to be quite distinct from insulin.