Pancreatic β-cells secrete insulin in response to fluctuations in blood fuel concentrations, in particular glucose and fatty acids. However, chronic fuel surfeit can overwhelm the metabolic, signaling and secretory capacity of the β-cell leading to its dysfunction and death – often referred to as glucolipotoxicity. In β-cells and many other cells, glucose and lipid metabolic pathways converge into a glycerolipid/free fatty acid (GL/FFA) cycle, which is driven by the substrates, glycerol-3-phosphate and fatty acyl-CoA, derived from glucose and fatty acids, respectively. Although the overall operation of GL/FFA cycle, consisting of lipolysis and lipogenesis, is “futile” in terms of energy expenditure, this metabolic cycle likely plays an indispensable role for various β-cell functions, in particular insulin secretion and excess fuel detoxification. In this review, we discuss the significance of GL/FFA cycle in the β-cell, its regulation and role in generating essential metabolic signals that participate in the lipid amplification arm of glucose stimulated insulin secretion and in β-cell growth. We propose the novel concept that the lipolytic segment of GL/FFA cycle is instrumental in producing signals for insulin secretion, whereas, the lipogenic segment generates signals relevant for β-cell survival/death and growth/proliferation.