The rate of incorporation of [U-14C]glucose and [u-14C]palmitate into the lipids of the pancreatic islets of obese-hyperglycaemic mice was examined. The following main observations were made. 1. Both glucose and palmitate were incorporated into lipids in the islets. The fraction of glucose utilized for lipid biosynthesis was calculated to be 3-6% of that oxidized at high and low glucose concentrations, whereas palmitate was about equally divided between oxidation and esterification into lipids. 2. Glucose was primarily incorporated from sn-glycerol 3-phosphate. Of the total glucose carbon incorporated, only 2-4% was recovered as fatty acids. 3. A major portion of both glucose and palmitate was incorporated into phospholipids, whereas 10-30% went into triacylglycerols, depending on the extracellular glucose concentrations. 4. An increase in the glucose concentration from 3.5 to 17 mM caused a twofold increase in the rate of glucose incorporation into triacylglycerols and a fivefold increase in the rate of incorporation into phospholipids. Similar effects were also obtained with normal mouse islets. Palmitate was also preferentially directed into phospholipids by an increased glucose concentration. 5. Islets pre-labelled with radioactive palmitate showed a decrease in triacylglycerol radioactivity when they were subsequently incubated in the absence of exogenous sources of energy. 6. Mannoheptulose inhibited the rate of glucose incorporation into phospholipids, whereas omission of Ca2+ and adrenaline left phospholipid biosynthesis unimpaired. The results suggest that pancreatic B-cells have the capacity to store and utilize energy in the form of triacylglycerols. A stimulation of the B-cells by glucose is followed by an increased rate of phospholipid biosynthesis. However, this does not seem to be directly linked to the release of secretory granules.