Aims/hypothesis. Glucagon-like peptide-1 is a potent glucoincretin hormone and a potentially important drug in the treatment of Type II (non-insulin-dependent) diabetes mellitus. We have investigated whether it acts as a growth factor in beta (INS-1)-cells and have studied the signalling pathways and transcription factors implicated in this process. Methods. Cell proliferation was assessed by tritiated thymidine incorporation measurements. We have examined the action of glucagon-like peptide-1 on the enzymatic activity of phosphatidylinositol 3-kinase. The DNA binding activity of transcription factors was investigated by electrophoretic mobility shift assay. Measurements of mRNA were done using the northern technique. Results. Glucagon-like peptide-1 caused an increase in tritiated thymidine incorporation in beta (INS-1)-cells and phosphatidylinositol 3-kinase activity in a dose-dependent manner non-additively with glucose. The phosphatidylinositol 3-kinase inhibitors wortmannin and LY294 002 blocked the effects of glucagon-like peptide-1 on DNA synthesis. Transcription factor pancreatic and duodenal homebox gene 1 (PDX-1) DNA binding activity was increased by glucagon-like peptide-1 at 3 or 11 mmol/l glucose and the phosphatidylinositol 3-kinase inhibitor LY294 002 suppressed the action of glucagon-like peptide-1 on PDX-1 DNA binding activity. Glucagon-like peptide-1 and glucose alone did not change activating protein-1 DNA binding activity. They synergised, however, to increase the activity of activating protein-1. Glucagon-like peptide-1 also increased the expression of PDX-1, glucose transporter 2, glucokinase and insulin mRNAs. Finally, glucagon-like peptide-1 increased the incorporation of tritiated thymidine in isolated rat islets. Conclusion/interpretation. The results suggest that glucagon-like peptide-1 may act as a growth factor for the beta cell by a phosphatidylinositol 3-kinase mediated event. Glucagon-like peptide-1 could also regulate the expression of the insulin gene and genes encoding enzymes implicated in glucose transport and metabolism through the phosphatidylinositol 3-kinase/PDX-1 transduction signalling pathway. [Diabetologia (1999) 42: 856–864]