Insulin binding to its receptor stimulates a tyrosine-specific protein kinase. This enzyme phosphorylates the insulin receptor, as well as a variety of exogenous substrates in vitro. In the present studies, we have identified an endogenous substrate for the insulin receptor-associated kinase. We studied insulin-stimulated protein phosphorylation in partially purified insulin receptor preparations from the livers of dexamethasone-treated rats. In this cell-free system, insulin stimulated the phosphorylation of its own receptor as well as of a phosphoprotein of apparent Mr = 120,000 (termed pp120). pp120 was not immunoprecipitated by three anti-receptor antisera, nor was the receptor immunoprecipitated by antisera raised against pp120, suggesting that pp120 is not antigenically related or tightly bound to the insulin receptor. Dose-response curves for receptor and pp120 phosphorylation stimulated by pork insulin were essentially identical, and showed the appropriate specificity (insulin much greater than proinsulin) for a receptor-mediated event. Phosphoamino acid analysis revealed that insulin stimulated the incorporation of 32P predominantly into tyrosine residues of pp120. Casein, an artificial substrate for the insulin receptor kinase, competed with pp120 for insulin-stimulated phosphorylation. Phosphorylation of pp120 was rapid (half-maximal effect within 2 min at 24 degrees C) and, like receptor phosphorylation, was supported with Mn2+ or Mg2+ as divalent cation and ATP as the phosphate donor. While receptor autophosphorylation and artificial substrate phosphorylation were not altered by prior treatment of the rats with dexamethasone, insulin-stimulated pp120 phosphorylation was enhanced in preparations derived from dexamethasone-treated rats, suggesting an alteration of pp120, not the receptor, as a result of dexamethasone-treatment. Further studies of this newly identified endogenous substrate may help clarify the physiologic role of the insulin receptor-associated kinase.