Recently, composite grafts of hepatocytes and islets have been shown to improve the survival of hepatocytes. The possibility of a reciprocal effect of hepatocytes on islet function was investigated. Diabetic Lewis rats were isografted with (1) fetal pancreas and fetal liver (FP/FL), (2) fetal pancreas alone (FP), and (3) fetal pancreas and fetal spleen (FP/FS). Grafts were transplanted to the small bowel subserosa. All (6/6) FP/FL recipients were cured (glucose less than 250 mg/dl for greater than 30 days), whereas only 72% (13/18) of FP alone and 60% (3/5) of FP/FS recipients were cured. The amount of time to normoglycemia for FP/FS recipients was less (26 +/- 15 days) compared with FP (50 +/- 29 days) or FP/FS recipients (71 +/- 40 days). Mean glucose levels at 6 weeks were 166 +/- 78 mg/dl, 237 +/- 97 mg/dl, and 355 +/- 81 mg/dl in cured FP/FL, FP, and FP/FS recipients, respectively. Glucose tolerance test results were not significantly different from those of nondiabetic control rats. In contrast to FP alone, FP/FL recipients had well-granulated hyperplastic islets and hepatocytes on histologic examination. When new isograft recipients were treated with cyclosporine, all FP recipients remained hyperglycemic; however, 75% (6/8) of FP/FL recipients were cured. In conclusion, FL in a composite graft with FP resulted in better engraftment, earlier isograft function, and protection from cyclosporine islet toxicity.