Activation of the prostaglandin E₂ receptor EP4 alters polarization of adipose tissue macrophages towards the anti-inflammatory M2 phenotype to suppress chronic inflammation. However, the role of EP4 signalling in pancreatic macrophages that affect insulin secretion is unclear. We examined the role of EP4 signalling in islet inflammation in vitro and in vivo. Obese diabetic db/db mice were treated with an EP4-selective agonist or vehicle for 4 weeks. Islet morphology did not significantly differ and glucose-stimulated insulin secretion was increased, whereas the pancreatic M1/M2 ratio was decreased in the EP4 agonist-treated group compared to the vehicle group. Because EP4 activation in MIN6 cells did not affect insulin secretion, we used a MIN6/macrophage co-culture system to evaluate the role of EP4 signalling in islet inflammation and subsequent inhibition of insulin release. Co-culture with M1-polarized macrophages markedly suppressed insulin expression in MIN6 cells; however, modulation of M1 polarization by the EP4 agonist significantly reversed the negative impact of co-cultivation on insulin production. The enhanced expression levels of pro-inflammatory cytokines in co-cultured MIN6 cells were markedly inhibited by EP4 agonist treatment of M1 macrophages. Thus, EP4 activation may suppress islet inflammation and protect β-cell function by altering inflammatory macrophages in the diabetic pancreas.