AngII (angiotensin II) may contribute to cardiovascular risk in obesity via adverse effects on insulin sensitivity and endothelial function. In the present study, we examined the effects of ARB (angiotensin receptor blocker) therapy (losartan, 100 mg/day) on insulin sensitivity and endothelial function in 53 subjects with stage I hypertension, abdominal obesity and impaired fasting glucose. The study design was a randomized double-blinded parallel design placebo-controlled multi-centre trial of 8 weeks duration. We used the hyperinsulinaemic-euglycaemic clamp technique to measure insulin sensitivity (expressed as the 'M/I' value) and RH-PAT (reactive hyperaemia-peripheral arterial tonometry) to measure endothelial function. Additional measures included HOMA (homoeostasis model assessment)-B, an index of pancreatic β-cell function, and markers of inflammation [e.g. CRP (C-reactive protein)] and oxidative stress (e.g. F2-isoprostanes). ARB therapy did not alter insulin sensitivity [5.2 (2.7) pre-treatment and 4.6 (1.6) post-treatment] compared with placebo therapy [6.1 (2.9) pre-treatment and 5.3 (2.7) post-treatment; P value not significant], but did improve the HOMA-B compared with placebo therapy (P=0.05). ARB therapy also did not change endothelial function [RH-PAT, 2.15 (0.7) pre-treatment and 2.11 (0.7) post-treatment] compared with placebo therapy [RH-PAT, 1.81 (0.5) pre-treatment and 1.76 (0.7) post-treatment; P value not significant]. Markers of inflammation and oxidative stress were not significantly changed by ARB therapy. In conclusion, ARB therapy did not alter peripheral insulin sensitivity or endothelial function in this cohort of patients with essential hypertension, abdominal obesity and impaired fasting glucose, but did improve pancreatic β-cell function.