Tissue-engineered pancreatic constructs based on immunoisolated, insulin-secreting cells are promising in providing an effective, relatively inexpensive, longterm treatment for type I (insulin-dependent) diabetes. An in vitro characterization of construct function under conditions mimicking the in vivo environment is essential prior to any extensive animal experimentation. Encapsulated cells may experience hypoxic conditions postimplantation as a result of one or more of the following: the design of the construct; the environment at the implantation site; or the development of fibrosis around the construct. In this work, we studied the effects of 3-and 4-day-long hypoxic episodes on the metabolic and secretory activities and on the levels of intracellular metabolites detectable by phosphorus-31 nuclear magnetic resonance ( 31 P NMR) of alginate/poly-L-lysine/ alginate entrapped TC3 mouse insulinomas continuously perfused with culture medium. Results show that, upon decreasing the oxygen concentration in the surrounding medium, the encapsulated cell system reached a new, lower metabolic and secretory state. Hypoxia drove the cells to a more anaerobic glycolytic metabolism, increased the rates of glucose consumption (GCR) and lactate production (LPR), and reduced the rates of oxygen consumption (OCR) and insulin secretion (ISR). Furthermore, hypoxia reduced the levels of intracellular nucleotide triphosphates (NTP) and phosphorylcholine (PC) and caused a rapid transient increase in inorganic phosphate (P i ). Upon restoration of the oxygen concentration in the perfusion medium, all parameters returned to their prehypoxic levels within 2 to 3 days following either gradual unidirectional changes (ISR, NTP, PC) or more complicated dynamic patterns (OCR, GCR, LPR). A further increase in oxygen concentration in the perfusion medium drove OCR, ISR, NTP, PC, and P i to new, higher levels. It is concluded that 31 P NMR spectroscopy can be used for the prolonged noninvasive monitoring of the bioenergetic changes of encapsulated TC3 cells occurring with changes in oxygen tension. The data also indicate that the oxygen-dependent states might be related to the total number of viable, metabolically active cells supported by the particular oxygen level to which the system is exposed. These findings have significant implications in developing and non-invasively monitoring a tissue-engineered bioartificial pancreas based on transformed  cells, as well as in understanding the biochemical events pertaining to insulin secretion from TC3 insulinomas.