Maintenance of functional β-cell mass is critical to preventing diabetes, but the physiological mechanisms that cause β-cell populations to thrive or fail in the context of obesity are unknown. High fat-fed SM/J mice spontaneously transition from hyperglycemic-obese to normoglycemic-obese with age, providing a unique opportunity to study β-cell adaptation. Here, we characterize insulin homeostasis, islet morphology, and β-cell function during SM/J\u27s diabetic remission. As they resolve hyperglycemia, obese SM/J mice dramatically increase circulating and pancreatic insulin levels while improving insulin sensitivity. Immunostaining of pancreatic sections reveals that obese SM/J mice selectively increase β-cell mass but not α-cell mass. Obese SM/J mice do not show elevated β-cell mitotic index, but rather elevated α-cell mitotic index. Functional assessment of isolated islets reveals that obese SM/J mice increase glucose-stimulated insulin secretion, decrease basal insulin secretion, and increase islet insulin content. These results establish that β-cell mass expansion and improved β-cell function underlie the resolution of hyperglycemia, indicating that obese SM/J mice are a valuable tool for exploring how functional β-cell mass can be recovered in the context of obesity