['The Hermann-Hering grid illusion consists of dark illusory spots perceived at the intersections of horizontal and vertical white bars viewed against a dark background. The dark spots originate from lateral inhibition processing. This illusion was used to investigate the hypothesis that lateral inhibition may be disrupted in diabetes mellitus.', 'A computer monitor based psychophysical test was developed to measure the threshold of perception of the illusion for different bar widths. The contrast threshold for illusion perception at seven bar widths (range 0.09 degrees to 0.60 degrees) was measured using a randomly interleaved double staircase. Convolution of Hermann-Hering grids with difference of Gaussian receptive fields was used to generate model sensitivity functions. The method of least squares was used to fit these to the experimental data. 14 diabetic patients and 12 control subjects of similar ages performed the test.', 'The sensitivity to the illusion was significantly reduced in the diabetic group for bar widths 0.22 degrees, 0.28 degrees, and 0.35 degrees (p = 0.01). The mean centre:surround ratio for the controls was 1:9.1 (SD 1.6) with a mean correlation coefficient of R(2) = 0.80 (SD 0.16). In the diabetic group, two subjects were unable to perceive the illusion. The mean centre:surround ratio for the 12 remaining diabetic patients was 1:8.6 (SD 2.1). However, the correlation coefficients were poor with a mean of R(2) = 0.54 (SD 0.27), p = 0.04 in comparison with the control group.'] Does the Hermann-Hering grid illusion demonstrate disruption of lateral inhibition processing in diabetes mellitus?