Islet transplantation can eliminate severe hypoglycemic episodes in patients with type 1 diabetes; however, whether intrahepatic islets respond appropriately to hypoglycemia after transplantation has not been fully studied. We evaluated six islet transplant recipients, six type 1 diabetic subjects, and seven nondiabetic control subjects using a stepped hyperinsulinemic-hypoglycemic clamp. Also, three islet transplant recipients and the seven control subjects underwent a paired hyperinsulinemic-euglycemic clamp. In response to hypoglycemia, C-peptide was similarly suppressed in islet transplant recipients and control subjects and was not detectable in type 1 diabetic subjects. Glucagon was significantly more suppressed in type 1 diabetic subjects than in islet transplant recipients (P < 0.01), although the glucagon in islet transplant recipients failed to activate as in the control subjects (P < 0.01). Pancreatic polypeptide failed to activate in both type 1 diabetic subjects and islet transplant recipients compared with control subjects (P < 0.01). In islet transplant recipients, glucagon was suppressed normally by hyperinsulinemia during the euglycemic clamp and was significantly greater during the paired hypoglycemic clamp (P < 0.01). These results suggest that after islet transplantation and in response to insulin-induced hypoglycemia, endogenous insulin secretion is appropriately suppressed and glucagon secretion may be partially restored.