Patients with long-standing type 1 diabetes (T1D) may exhibit defective glucose counterregulation and impaired hypoglycemia symptom recognition that substantially increase their risk for experiencing severe hypoglycemia. The purpose of this study was to determine whether intrahepatic islet transplantation improves endogenous glucose production (EGP) in response to hypoglycemia in T1D patients experiencing severe hypoglycemia. We studied longitudinally subjects (n = 12) with ∼30 years, disease duration before and 6 months after intrahepatic islet transplantation using stepped hyperinsulinemic-hypoglycemic and paired hyperinsulinemic-euglycemic clamps with infusion of 6,6-²H₂-glucose and compared the results with those from a nondiabetic control group (n = 8). After islet transplantation, HbA_1c was normalized, and time spent while hypoglycemic (<70 mg/dL) was nearly abolished as indicated by continuous glucose monitoring. In response to insulin-induced hypoglycemia, C-peptide (absent before transplant) was appropriately suppressed, glucagon secretion was recovered, and epinephrine secretion was improved after transplantation. Corresponding to these hormonal changes, the EGP response to insulin-induced hypoglycemia, which was previously absent, was normalized after transplantation, with a similar effect seen for autonomic symptoms. Because the ability to increase EGP is ultimately required to circumvent the development of hypoglycemia, these results provide evidence that intrahepatic islet transplantation can restore glucose counterregulation in long-standing T1D and support its consideration as treatment for patients with hypoglycemia unawareness experiencing severe hypoglycemia.