Reactive oxygen species (ROS) have been widely implicated in the pathogenesis of diabetes and more recently in mitochondrial alterations in skeletal muscle of diabetic mice. However, so far the exact sources of ROS in skeletal muscle have remained elusive. Aiming at better understanding the causes of mitochondrial alterations in diabetic muscle, we designed this study to characterize the sites of ROS production in skeletal muscle of streptozotocin (STZ)-induced diabetic mice. Hyperglycemic STZ mice showed increased markers of systemic and muscular oxidative stress, as evidenced by increased circulating H(2)O(2) and muscle carbonylated protein levels. Interestingly, insulin treatment reduced hyperglycemia and improved systemic and muscular oxidative stress in STZ mice. We demonstrated that increased oxidative stress in muscle of STZ mice is associated with an increase of xanthine oxidase (XO) expression and activity and is mediated by an induction of H(2)O(2) production by both mitochondria and XO. Finally, treatment of STZ mice, as well as high-fat and high-sucrose diet-fed mice, with oxypurinol reduced markers of systemic and muscular oxidative stress and prevented structural and functional mitochondrial alterations, confirming the in vivo relevance of XO in ROS production in diabetic mice. These data indicate that mitochondria and XO are the major sources of hyperglycemia-induced ROS production in skeletal muscle and that the inhibition of XO reduces oxidative stress and improves mitochondrial alterations in diabetic muscle.