Insulin resistance is a syndrome that affects multiple insulin target tissues, each having different biological functions regulated by insulin. A remaining question is to mechanistically explain how an insulin target cell/tissue can be insulin resistant in one biological function and insulin sensitive in another at the same time. Here, we provide evidence that in pancreatic β cells, knockdown of PI3K-C2α expression results in rerouting of the insulin signal from insulin receptor (IR)-B/PI3K-C2α/PKB-mediated metabolic signaling to IR-B/Shc/ERK-mediated mitogenic signaling, which allows the β cell to switch from a highly glucose-responsive, differentiated state to a proliferative state. Our data suggest the existence of IR-cascade-selective insulin resistance, which allows rerouting of the insulin signal within the same target cell. Hence, factors involved in the rerouting of the insulin signal represent tentative therapeutic targets in the treatment of insulin resistance.