In rodents and in humans, β-cell proliferation declines rapidly after birth. In mice, this decline coincides with the formation of the Islets of Langerhans, beginning between e17.5 and birth. Previous studies have indicated that islet formation requires the function of the adhesion molecule, E-cadherin, which facilitates cell-cell contact between endocrine cells. Because Islets of Langerhans formation results in increased β-cell-to-β-cell contact, we hypothesized that one mechanism that controls proliferation is that E-cadherin protein is increased in β-cells during islet formation, inducing a postnatal decrease in β-cell proliferation. E-cadherin is known to reduce nuclear β-catenin and the expression of D-cyclins. In this study, we relate changes in E-cadherin protein levels to β-cell number and to measures of cell proliferation, such as the marker Ki67 and Cyclin D1/D2, before and after islet formation in vitro and in vivo. In vitro comparisons of such measures of proliferation before and after islet formation were performed in β-TC6 cells when they form pseudoislets or monolayers. Expression of Cyclin D2 was reduced in pseudo-islets, accompanied by decreased β-cell proliferation rates. In FACS-sorted GFP-labelled β-cells of transgenic mice, E-cadherin protein per β-cell increased from birth to 2 months; Cyclin D1/D2 expression and levels of nuclear β-catenin decreased during that period. In mice carrying a β-cell specific knockout of E-cadherin (Ecad βKO), β-cell proliferation, as measured by Ki67 staining, was increased, as were Cyclin D1 and D2 expression and nuclear β-catenin. Ecad βKO mice showed increased β-cell mass at 3-months of age. When examined by light and electron microscopy, the architecture of these islets was similar to the islets of control mice. Despite the increase in β-cell mass, and absence of apparent structural disruption, Ecad βKO mice showed reduced glucose tolerance measured by ipGTT and reduced insulin secretion in response to 5mM glucose in vitro at 4 months of age. Thus, the increased mass of β-cells does not imply a corresponding response to glucose. To examine this phenomenon, we asked whether protein levels of gap- and tight-junction related proteins were affected. Reduction in protein expression of Connexin 36 and Zonula Occuldin, which are the main components of gap- and tight-junctions, respectively, was observed in Ecad βKO islets. This reduction could account for the defects in insulin secretion in response to ambient glucose. These findings support the hypothesis that increases in E-cadherin, in response to increased cell-cell contact, in the islets play a role in decreasing cell proliferation in β-cells during islet formation, and suggest a subtle role for E-cadherin in the functional integrity of β-cells.