Peroxisome proliferator–activated receptor (PPAR) α is a transcription factor controlling lipid and glucose homeostasis. PPARα-deficient (−/−) mice are protected from high-fat diet–induced insulin resistance. However, the impact of PPARα in the pathophysiological setting of obesity-related insulin resistance is unknown. Therefore, PPARα^−/− mice in an obese (ob/ob) background were generated. PPARα deficiency did not influence the growth curves of the obese mice but surprisingly resulted in a severe, age-dependent hyperglycemia. PPARα deficiency did not aggravate peripheral insulin resistance. By contrast, PPARα^−/− ob/ob mice developed pancreatic β-cell dysfunction characterized by reduced mean islet area and decreased insulin secretion in response to glucose in vitro and in vivo. In primary human pancreatic islets, PPARα agonist treatment prevented fatty acid–induced impairment of glucose-stimulated insulin secretion, apoptosis, and triglyceride accumulation. These results indicate that PPARα improves the adaptative response of the pancreatic β-cell to pathological conditions. PPARα could thus represent a promising target in the prevention of type 2 diabetes.