To meet the increased demand for insulin during pregnancy, the pancreatic islets undergo adaptive changes including enhanced insulin secretion and β-cell proliferation. These changes peak in mid-pregnancy and return to control levels by parturition. Because lactogens (placental lactogen and/or prolactin) induce this up-regulation and remain elevated throughout gestation, we examined whether lipids alter the effects of prolactin on islets. In response to prolactin, there was a 2-5-fold increase in insulin secretion when compared with control islets. There was also a 2-5-fold increase in insulin secretion in response to palmitate and a fivefold increase when islets were cultured with a combination of prolactin and palmitate. After culture with prolactin and paln-fitate, acute stimulation with 10 mM glucose for 1 h showed a suppression of insulin release. However, including palmitate in the stimulation media (a condition similar to late pregnancy in vivo) restored a higher rate of insulin release. This suggests that elevated lipids in late pregnancy lead to enhanced insulin secretion that is increasingly dependent on lipids and less sensitive to glucose. β-Cell proliferation was also increased sixfold by prolactin and threefold with palmitate. The combination of both was slightly more than additive (11-fold). Sinular experiments with oleate had no effiect on insulin secretion. However, oleate stimulated β-cell division by threefold and was synergistic with prolactin (21-fold). These results were repeated in experiments including normal serum. Interestingly, prolactin also blocked the reduction of glucokinase levels observed with fatty acids. Overall, these results suggest that increased lipids during pregnancy likely contribute to the adaptation of islets to pregnancy by further enhancing β-cell division. In addition, the increase in lipids leads to enhanced insulin secretion that is less sensitive to glucose and more dependent on lipids. This provides a potential mechanism for maintaining elevated insulin secretion until parturition while preparing islets for normal glucose sensitivity post partum.