Insulin resistance associated with Type 2 diabetes contributes to impaired vasorelaxation and therefore contributes to the enhanced incidence of hypertension observed in diabetes. In this study, we examined the role of insulin on the association of the myosin-binding subunit of myosin phosphatase (MYPT1) to myosin phosphatase Rho-interacting protein (MRIP), a relatively novel member of the myosin phosphatase complex that directly binds RhoA in vascular smooth muscle cells (VSMCs). Through a series of molecular and cellular studies, we investigated whether insulin stimulates the binding of MRIP to MYPT1 and compared the results generated from VSMCs isolated from both Wistar-Kyoto (WKY) control and Goto-Kakizaki (GK) diabetic rats. We demonstrate for the first time that insulin stimulates the binding of MRIP to MYPT1 in a dose- and time-dependent manner, as determined by immunoprecipitation, implying a regulatory role for MRIP in insulin-induced vasodilation signaling via MYPT1 interaction. VSMCs from GK model of Type 2 diabetes had impaired insulin-induced MRIP/MYPT1 binding as well as reduced MRIP expression. Adenovirus-mediated overexpression of MRIP in GK VSMCs led to significantly improved insulin-stimulated MRIP/MYPT1 binding. Finally, insulin-stimulated MRIP translocation out of stress fibers, which was observed in control VSMCs, was impaired in GK VSMCs. We believe the impaired expression of MRIP, and therefore decreased insulin-stimulated MRIP/MYPT1 association, in the GK diabetic model may contribute to the impaired insulin-mediated vasodilation observed in the diabetic vasculature and provides a novel therapeutic strategy for the treatment of Type 2 diabetes.