Intrauterine growth restriction (IUGR) increases the risk of type 2 diabetes developing in adulthood. In previous studies that used bilateral uterine artery ligation in a rat model of IUGR, age-associated decline in glucose homeostasis and islet function was revealed. To elucidate mechanisms contributing to IUGR pathogenesis, the islet transcriptome was sequenced from 2-week-old rats, when in vivo glucose tolerance is mildly impaired, and at 10 weeks of age, when rats are hyperglycemic and have reduced β-cell mass. RNA sequencing and functional annotation with Ingenuity Pathway Analysis revealed temporal changes in IUGR islets. For instance, gene expression involving amino acid metabolism was significantly reduced primarily at 2 weeks of age, but ion channel expression, specifically that involved in cell-volume regulation, was more disrupted in adult IUGR islets. Additionally, we observed alterations in the microenvironment of IUGR islets with extracellular matrix genes being significantly increased at 2 weeks of age and significantly decreased at 10 weeks. Specifically, hyaluronan synthase 2 expression and hyaluronan staining were increased in IUGR islets at 2 weeks of age (P < 0.05). Mesenchymal stromal cell-derived factors that have been shown to preserve islet allograft function, such as Anxa1, Cxcl12, and others, also were increased at 2 weeks and decreased in adult islets. Finally, comparisons of differentially expressed genes with those of type 2 diabetic human islets support a role for these pathways in human patients with diabetes. Together, these data point to new mechanisms in the pathogenesis of IUGR-mediated islet dysfunction in type 2 diabetes.