The molecular mechanism by which interleukin (IL)-1 inhibits insulin secretion and ultimately causes destruction of the pancreatic beta-cell remains unknown. Evidence is presented which suggests that IL-1 beta-induced inhibition of insulin secretion is dependent on the metabolism of L-arginine to nitric oxide. NG-Monomethylarginine, a competitive inhibitor of the L-arginine-dependent enzyme nitric oxide synthase, completely prevents IL-1-induced inhibition of glucose-stimulated insulin secretion as well as nitrite production by islets. It is further shown that IL-1 beta induces nitric oxide formation in islets as evidenced by an electron paramagnetic resonance feature at g = 2.04 which is similar to previously reported iron-nitrosyl complexes formed from the destruction of iron-sulfur centers by nitric oxide. Inhibition of the nitric oxide synthase by NG-monomethylarginine completely prevents the formation of this EPR signal in islets. These results show that IL-1-induced inhibition of insulin secretion is mediated through formation of nitric oxide and suggest that the generation of nitric oxide may represent the cellular mechanism responsible for beta-cell destruction.