PAX4 is a key regulator of pancreatic islet development whilst in adult acute overexpression protects β-cells against stress-induced apoptosis and stimulates proliferation. Nonetheless, sustained PAX4 expression promotes β-cell dedifferentiation and hyperglycemia, mimicking β-cell failure in diabetic patients. Herein, we study mechanisms that allow stringent PAX4 regulation endowing favorable β-cell adaptation in response to changing environment without loss of identity. To this end, PAX4 expression was monitored using a mouse bearing the enhanced green fluorescent protein (GFP) and cre recombinase construct under the control of the islet specific pax4 promoter. GFP was detected in 30% of islet cells predominantly composed of PAX4-enriched β-cells that responded to glucose-induced insulin secretion. Lineage tracing demonstrated that all islet cells were derived from PAX4(+) progenitor cells but that GFP expression was confined to a subpopulation at birth which declined with age correlating with reduced replication. However, this GFP(+) subpopulation expanded during pregnancy, a state of active β-cell replication. Accordingly, enhanced proliferation was exclusively detected in GFP(+) cells consistent with cell cycle genes being stimulated in PAX4-overexpressing islets. Under stress conditions, GFP(+) cells were more resistant to apoptosis than their GFP(-) counterparts. Our data suggest PAX4 defines an expandable β-cell sub population within adult islets.