Normoglycemic ob/ob mice were treated for 24 or 48 h with either 25 micrograms/day of dexamethasone or saline. After an overnight fast, the animals were killed and pancreatic islets were incubated with 3H2O or [U-14C]glucose or [5-3H]glucose at 5.5 and 16.7 mM glucose. Incorporation of 3H from 3H2O into carbon 2 of medium glucose and the yield of 14CO2 from [U-14C]glucose and 3H2O from [5-3H]glucose were measured. Dexamethasone treatment for 48 h significantly increased the rate of dephosphorylation of glucose in islets both at 5.5 mM (24 vs. 16%) and 16.7 mM (56 vs. 36%) glucose, whereas glucose oxidation and utilization were unaffected. Dexamethasone treatment also inhibited insulin release by approximately 60% at 5.5 and 16.7 mM glucose, either in the presence or absence of 10 mM arginine, but had no effect when insulin release was stimulated by 1 mM 3-isobutyl-1-methylxanthine. Moreover, 24-h treatment with dexamethasone significantly increased glucose cycling at low and high glucose concentrations in the medium and inhibited insulin responsiveness to glucose and arginine. In conclusion, short-term dexamethasone treatment increases glucose flux through glucose-6-phosphatase in islets from ob/ob mice. This effect may contribute to the decreased insulin response to glucose and arginine found in animals treated with dexamethasone.