Objective: Chronic exposure to elevated levels of free fatty acids contributes to pancreatic beta cell dysfunction. As previous studies have shown inconsistent results with regard to action of metformin on pancreatic beta cells, we aimed to examine the effects of metformin on pancreatic beta cells under lipotoxic stress in relation to metformin concentration and dependence on adenosine monophosphate-activated protein kinase (AMPK). Methods: We measured viability and glucose-stimulated insulin secretion (GSIS) in NIT-1 cells and isolated mouse islets exposed to palmitate and various concentrations of metformin. To determine the dependence on AMPK, AMPK activator and AMPK antagonist were treated in parallel with metformin and levels of AMPK phosphorylation were measured. As markers for cellular metabolism, cellular adenosine diphosphate and triphosphate levels (ADP/ATP) were measured and autofluorescence imaging of the pyridine nucleotides was obtained. We measured messenger RNA levels of endoplasmic reticulum (ER) stress markers, glucose-stimulated calcium influx, intracellular reactive oxygen species (ROS) levels and caspase-3 activity as markers for lipotoxicity. Results: We find that metformin has protective effects on palmitate-induced beta cell dysfunction. Metformin at 0.05~0.1 mM concentrations ameliorates palmitate-induced beta cell dysfunction in a AMPK-independent manner by inhibiting ER stress markers, intracellular ROS level, and caspase-3 activity, whereas metformin at 0.5 mM concentration depletes cellular ATP levels, restores calcium influx reduced by palmitate and improves lipotoxic beta cell dysfunction in a AMPK-dependent manner. Cytosolic redox state is increased by metformin at 0.05 mM concentrations at which AMPK activation does not occur. Conclusion: This study suggests that metformin’s action on beta cell lipotoxicity is implemented by different molecular pathways depending on its concentration. Metformin at usual therapeutic dose is supposed to alleviate lipotoxic beta cell dysfunction through inhibition of oxidative stress and ER stress.