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Differentiated pancreatic beta cells are unique in their ability to secrete insulin in response to a rise in plasma glucose. We have proposed that the unique constellation of genes they express may be lost in diabetes due to the deleterious effect of chronic hyperglycemia. To test this hypothesis, Sprague-Dawley rats were submitted to a 85-95% pancreatectomy or sham pancreatectomy. One week later, the animals developed mild to severe chronic hyperglycemia that was stable for the next 3 weeks, without significant alteration of plasma nonesterified fatty acid levels. Expression of many genes important for glucose-induced insulin release decreased progressively with increasing hyperglycemia, in parallel with a reduction of several islet transcription factors involved in beta cell development and differentiation. In contrast, genes barely expressed in sham islets (lactate dehydrogenase A and hexokinase I) were markedly increased, in parallel with an increase in the transcription factor c-Myc, a potent stimulator of cell growth. These abnormalities were accompanied by beta cell hypertrophy. Changes in gene expression were fully developed 2 weeks after pancreatectomy. Correction of blood glucose by phlorizin for the next 2 weeks normalized islet gene expression and beta cell volume without affecting plasma nonesterified fatty acid levels, strongly suggesting that hyperglycemia triggers these abnormalities. In conclusion, chronic hyperglycemia leads to beta cell hypertrophy and loss of beta cell differentiation that is correlated with changes in c-Myc and other key transcription factors. A similar change in beta cell differentiation could contribute to the profound derangement of insulin secretion in human diabetes.