Background: E4orf1 protein derived from adenovirus-36 reduces glucose excursion in mice, and lowers endogenous insulin response, suggesting a reduced need for insulin. We tested if the E4orf1-mediated lowering of insulin response is due to increased tissue sensitivity to insulin, reduced ability to produce or release insulin, or a reduced need for insulin release. Methods: Experiment 1: hyperinsulinemic–euglycemic clamps (HEC) and glucose tolerance test (GTT) were performed in high fat fed transgenic mice expressing E4orf1 or non-transgenic littermates (n = 12 each), for 4 weeks. Experiments 2, 3, and 4: E4orf1 or null vectors were expressed in rat-pancreatic β-cell line (INS-1) for 72 h, and cells were exposed to varying levels of glucose. Cell lysates and media were collected. Experiment 5: 3T3L1-preadipocytes that express E4orf1 upon doxycycline induction, or null vector were induced with doxycycline and then exposed to protein transport inhibitor. Supernatant and cell lysate were collected. Experiment 6: 3T3L1-preadipocytes that express E4orf1 upon doxycycline induction, or null vector were co-cultured with INS-1 cells for 24 h. Media was collected. Results: Experiment 1: E4orf1 transgenic mice cleared glucose faster compared to non-transgenic mice during GTT. HEC showed that E4orf1 did not alter tissue sensitivity to exogenous insulin in mice. Experiments 2, 3, and 4: in INS1 cells, E4orf1 did not alter Glut2 abundance or Akt activation, suggesting no reduction in glucose sensing or insulin synthesis, respectively. E4orf1 did not influence glucose-stimulated insulin secretion in media by INS1 cells. Experiment 5: E4orf1 was present in cell lysate, but not in media, indicating it is not a secretory protein. Experiment 6: INS1 cells released less insulin in media when co-cultured in the presence of E4orf1-expressing 3T3-L1 cells. Conclusions: Our studies support the working hypothesis that the E4orf1-mediated lowering of insulin response is not due to increased tissue sensitivity to insulin, or reduced ability to produce or release insulin, but likely to be due to a reduced need for insulin release.