Pancreatic islets have a dense capillary network, which provides nutrients, allows for accurate glucose sensing and disperses hormones. Vascular endothelial growth factor (VEGF) is a hypoxia-driven endothelial cell mitogen constitutively expressed in pancreatic islet ß-cells while islet microvasculature expresses VEGF receptors. To what extent VEGF affects endocrine function and growth in adult cells is unknown. In the present investigation, we tested the hypothesis that there is an endothelial-endocrine interaction during ß-cell growth and islet angiogenesis. Mice expression VEGF under the control of the rat insulin promoter (RIP) were utilized. Expression of VEGF was determined in isolated islets. Matrigel containing islets and VEGF was injected subcutaneously to study angiogenesis. Islets were transplanted to the kidney capsule or the liver, and islet mass was estimated by insulin content and bromodesoxyuridine (BrdU) incorporation. VEGF was expressed in islets of RIP-VEGF mice. Glucose and hypoxic environment stimulated VEGF secretion. Endothelial tube formation of islets embedded into a gel was increased in the presence of VEGF. Insulin content of the RIP-VEGF grafts was increased twofold compared with the controls. ß-cell mass determined by morphometry confirmed this result. BrdU labelling index was increased more than fivefold. Overexpression of VEGF in pancreatic islets results in increased angiogenesis and greater availability of insulin caused by ß -cell proliferation.