The novel insulin-secreting human pancreatic β-cell line, 1.1B4, demonstrates stability in culture and many of the secretory functional attributes of human pancreatic β-cells. This study investigated the cellular responses of 1.1B4 cells to lipotoxicity. Chronic 18-h exposure of 1.1B4 cells to 0.5 mm palmitate resulted in decreased cell viability and insulin content. Secretory responses to classical insulinotropic agents and cellular Ca²⁺ handling were also impaired. Palmitate decreased glucokinase activity and mRNA expression of genes involved in secretory function but up-regulated mRNA expression of HSPA5, EIF2A, and EIF2AK3, implicating activation of the endoplasmic reticulum stress response. Palmitate also induced DNA damage and apoptosis of 1.1B4 cells. These responses were accompanied by increased gene expression of the antioxidant enzymes SOD1, SOD2, CAT and GPX1. This study details molecular mechanisms underlying lipotoxicity in 1.1B4 cells and indicates the potential value of the novel β-cell line for future research.