We have previously shown that fetuses from undernourished (U) pregnant rats exhibited an increased beta cell mass probably related to an enhanced IGF-1 replicative response. Because IGF-1 signaling pathways have been implicated in regulating beta cell growth, we investigated in this study the IGF-1 transduction system in U fetuses. To this end, an in vitro model of primary fetal islets was developed to characterize glucose/IGF-1 mediated signaling that specially influences beta cell proliferation. We found that U fetal islets showed a greater replicative response to glucose and IGF-1 than controls. Furthermore, IRS-2 protein and its association with p85 were also increased. In the complete absence of IGF-1 or stimulatory glucose, U islets presented an increased basal phosphorylation of downstream signals of the PI3K pathway such as PKB, GSK3alfa/beta, PKCzeta and m-TOR. Similarly, phosphorylation of these proteins (except GSK3alpha/beta) by glucose and IGF-1 was augmented even though total protein content remained unchanged. Downstream of PKB, direct glucose activation of m-TOR was increased as well. In contrast, ERK 1/2 phosphorylation was unaffected by undernutrition but ERKs activation seemed to be required to induce a higher proliferative response in U islets. In conclusion, we have demonstrated that fetal U islets show increased IRS-2 content and an enhancement in both basal and glucose/IGF-1 activations of the IRS-2/PI3K/PKB pathway. These molecular changes may be responsible for the greater glucose/IGF-1 islet replication and contribute to the increased beta cell mass found in these fetuses.