The Pioglitazone In Prevention Of Diabetes (PIPOD) study was conducted to evaluate β-cell function, insulin resistance, and the incidence of diabetes during treatment with pioglitazone in Hispanic women with prior gestational diabetes who had completed participation in the Troglitazone In Prevention Of Diabetes (TRIPOD) study. Women who completed the TRIPOD study were offered participation in the PIPOD study for a planned 3 years of drug treatment and 6 months of postdrug washout. Oral glucose tolerance tests were performed annually on pioglitazone and at the end of the postdrug washout. Intravenous glucose tolerance tests (IVGTTs) for assessment of insulin sensitivity and β-cell function were conducted at baseline, after 1 year on pioglitazone, and at the end of the postdrug washout. Of 95 women who were not diabetic at the end of the TRIPOD study, 89 enrolled in the PIPOD study, 86 completed at least one follow-up visit, and 65 completed all study visits, including the postdrug tests. Comparison of changes in β-cell compensation for insulin resistance across the TRIPOD and PIPOD studies revealed that pioglitazone stopped the decline in β-cell function that occurred during placebo treatment in the TRIPOD study and maintained the stability of β-cell function that had occurred during troglitazone treatment in the TRIPOD study. The risk of diabetes, which occurred at an average rate of 4.6% per year, was lowest in women with the largest reduction in total IVGTT insulin area after 1 year of treatment. The similarity of findings between the PIPOD and TRIPOD studies support a class effect of thiazolidinedione drugs to enhance insulin sensitivity, reduce insulin secretory demands, and preserve pancreatic β-cell function, all in association with a relatively low rate of type 2 diabetes, in Hispanic women with prior gestational diabetes.