In order to elucidate cellular mechanisms causing skeletal malformations in offspring of diabetic rats we studied the incorporation of thymidine and sulphate into embryonic (pre)chondrocytes exposed to increased levels of D-glucose and β-hydroxybutyric acid for six days in vitro. The (pre)chondrocytes were prepared from embryos of normal or diabetic rats of a malformation-prone strain or from embryos of normal rats of a non-malformation-prone strain. Diabetic female rats of the former strain are known to produce a high proportion of offspring with mandibular and lumbosacral malformations. Increased β-hydroxybutyric acid caused decreased thymidine incorporation in all types of chondrocytes, and decreased sulphate incorporation in limb bud cells from embryos of normal rats from both strains. Elevated D-glucose levels yielded a slight decrease in thymidine incorporation in mandibular arch cells from embryos of normal rats of the malformation-prone strain, and a marked decrease of both sulphate and thymidine incorporation in mandibular arch cells from embryos of diabetic rats of this strain. The observations suggest that elevated levels of D-glucose or β-hydroxybutyric acid are able to inhibit the differentiation and growth of (pre)chondrocytes and illustrate a selective sensitivity of mandibular arch (pre)chondrocytes to a diabetic environment. The data are compatible with the view that both D-glucose and β-hydroxybutyric acid may cause aberrations in the development of rat mandibular arch chondrocytes, suggesting a role for these compounds in diabetic teratogenesis.