ATP-sensitive K⁺ (K_ATP) channels, comprised of pore-forming Kir6.2 and regulatory SUR subunits, play a crucial role in regulating insulin secretion from pancreatic β-cells by coupling glucose metabolism to insulin exocytosis. Each Kir subunit is associated with a regulatory sulphonylurea receptor (SUR) subunit, the SUR1 isoform being found in β-cells (Aguilar-Bryan et al. 1995). Metabolic regulation of K_ATP channel activity is mediated by changes in the intracellular concentrations of adenine nucleotides. Binding of ATP to Kir6.2 inhibits, whereas interaction of MgATP with SUR1 activates, K_ATP channels. We tested the functional effects of two Kir6.2 heterozygous (het) mutations (Y330C, F333I) that cause permanent neonatal diabetes mellitus (PNDM) (Sagen et al. 2004; Vaxillaire et al. 2004), by heterologous expression in Xenopus oocytes. In a homology model of Kir6.2 (Antcliff et al. 2005), both residues lie close to the outer mouth of the ATP-binding site, suggesting that they may impair the channel ATP sensitivity. K_ATP currents were recorded from Xenopus Laevis oocytes 1-3 days after injection with wild-type (wt) or mutant Kir6.2 and SUR1 mRNA. To simulate the het state a 1:1 mixture of wt and mutant Kir6.2 mRNA was used. Macroscopic or single channel currents were recorded from inside-out patches with the patch-clamp technique. The pipette solution contained (mM): 140 KCl, 1.2 MgCl₂, 2.6 CaCl₂, 10 HEPES (pH 7.4) plus various ATP concentrations. The Mg-free internal (bath) solution contained (mM): 107 KCl, 1 K₂SO₄, 10 EGTA, 10 HEPES (pH 7.2). The Mg-containing internal solution consisted of Mg-free solution plus 2 mM MgCl₂ and MgATP (instead of ATP). Both mutations reduced ATP inhibition in the absence of Mg²⁺: the IC₅₀ was 10.6±1.8 (n=10) μM for wt, compared to 22.8±4.6 (n=5) μM and 19.7±2.0 (n=6) μM for hetF333I and hetY330C channels, respectively. This effect was greater in the presence of 2 mM Mg²⁺: IC₅₀ were 16.7±2.6 (n=6) μM, 39.0±4.0 (n=6) μM and 116±19 (n=6) μM for wt, hetF333I and hetY330C channels, respectively. Single channel studies indicated the Y330C mutation reduced ATP inhibition both by impairing ATP binding and indirectly, by stabilizing the intrinsic open state of the channel. In contrast, F333I channels had wt kinetics. The stimulatory effect of MgATP (mediated via SUR1) was greatly enhanced by the F333I mutation, an effect that was abolished by SUR1 mutations which prevent MgATP binding/hydrolysis. For both mutations, K_ATP currents in 1-3 mM MgATP were increased. In β-cells, this would decrease electrical activity and insulin secretion, thereby producing neonatal diabetes. These data also demonstrate that region of Kir6.2 in which Y330 and F333I reside influences ATP binding and the mechanism(s) by which SUR1 influences intrinsic gating and MgADP activation.