Interleukin-1beta (IL-1beta) is a potent inflammatory cytokine involved in type 1 diabetes and acts through defined IL-1beta signaling pathways. In the present work we describe induction of DNA binding activity to signal transducer and activator of transcription (STAT) in response to IL-1beta in clonal insulin-secreting cells. Moreover, IL-1beta activates a short isoform of STAT-3 that potently stimulates transcription. Immunoprecipitation studies reveal an interaction between the activated STAT-3 and the IL-1 receptor accessory protein indicating an association between the two signaling pathways. This may be a novel point of transduction cross talk and an additional mechanism utilised by IL-1beta in the pancreatic beta-cell during the process of type 1 diabetes.