Exposure of insulin-producing cells to elevated levels of the free fatty acid (FFA) palmitate results in the loss of β-cell function and induction of apoptosis. The induction of endoplasmic reticulum (ER) stress is one mechanism proposed to be responsible for the loss of β-cell viability in response to palmitate treatment; however, the pathways responsible for the induction of ER stress by palmitate have yet to be determined. Protein palmitoylation is a major posttranslational modification that regulates protein localization, stability, and activity. Defects in, or dysregulation of, protein palmitoylation could be one mechanism by which palmitate may induce ER stress in β-cells. The purpose of this study was to evaluate the hypothesis that palmitate-induced ER stress and β-cell toxicity are mediated by excess or aberrant protein palmitoylation. In a concentration-dependent fashion, palmitate treatment of RINm5F cells results in a loss of viability. Similar to palmitate, stearate also induces a concentration-related loss of RINm5F cell viability, while the monounsaturated fatty acids, such as palmoleate and oleate, are not toxic to RINm5F cells. 2-Bromopalmitate (2BrP), a classical inhibitor of protein palmitoylation that has been extensively used as an inhibitor of G protein-coupled receptor signaling, attenuates palmitate-induced RINm5F cell death in a concentration-dependent manner. The protective effects of 2BrP are associated with the inhibition of [(3)H]palmitate incorporation into RINm5F cell protein. Furthermore, 2BrP does not inhibit, but appears to enhance, the oxidation of palmitate. The induction of ER stress in response to palmitate treatment and the activation of caspase activity are attenuated by 2BrP. Consistent with protective effects on insulinoma cells, 2BrP also attenuates the inhibitory actions of prolonged palmitate treatment on insulin secretion by isolated rat islets. These studies support a role for aberrant protein palmitoylation as a mechanism by which palmitate enhances ER stress activation and causes the loss of insulinoma cell viability.