Chronic exposure of pancreatic β-cells to saturated non-esterified fatty acids can lead to inhibition of insulin secretion and apoptosis. Several previous studies have demonstrated that saturated fatty acids such as PA (palmitic acid) are detrimental to β-cell function compared with unsaturated fatty acids. In the present study, we describe the effect of the polyunsaturated AA (arachidonic acid) on the function of the clonal pancreatic β-cell line BRIN-BD11 and demonstrate AA-dependent attenuation of PA effects. When added to β-cell incubations at 100 μM, AA can stimulate cell proliferation and chronic (24 h) basal insulin secretion. Microarray analysis and/or real-time PCR indicated significant AA-dependent up-regulation of genes involved in proliferation and fatty acid metabolism [e.g. Angptl (angiopoietin-like protein 4), Ech1 (peroxisomal Δ3,5,Δ2,4-dienoyl-CoA isomerase), Cox-1 (cyclo-oxygenase-1) and Cox-2, P<0.05]. Experiments using specific COX and LOX (lipoxygenase) inhibitors demonstrated the importance of COX-1 activity for acute (20 min) stimulation of insulin secretion, suggesting that AA metabolites may be responsible for the insulinotropic effects. Moreover, concomitant incubation of AA with PA dose-dependently attenuated the detrimental effects of the saturated fatty acid, so reducing apoptosis and decreasing parameters of oxidative stress [ROS (reactive oxygen species) and NO levels] while improving the GSH/GSSG ratio. AA decreased the protein expression of iNOS (inducible NO synthase), the p65 subunit of NF-κB (nuclear factor κB) and the p47 subunit of NADPH oxidase in PA-treated cells. These findings indicate that AA has an important regulatory and protective β-cell action, which may be beneficial to function and survival in the 'lipotoxic' environment commonly associated with Type 2 diabetes mellitus.