Inflammation contributes to the pathophysiology of diabetes. Identifying signaling pathways involved in pancreatic β-cell failure and identity loss can give insight into novel potential treatment strategies to prevent the loss of functional β-cell mass in diabetes. It is reported earlier that the immunosuppressive drug tacrolimus has a detrimental effect on human β-cell identity and function by activating bone morphogenetic protein (BMP) signaling. Here it is hypothesized that enhanced BMP signaling plays a role in inflammation-induced β-cell failure. Single-cell transcriptomics analyses of primary human islets reveal that IL-1β+IFNγ and IFNα treatment activated BMP signaling in β-cells. These findings are validated by qPCR. Furthermore, enhanced BMP signaling with recombinant BMP2 or 4 triggers a reduced expression of key β-cell maturity genes, associated with increased ER stress, and impaired β-cell function. Altogether, these results indicate that inflammation-activated BMP signaling is detrimental to pancreatic β-cells and that BMP-signaling can be a target to preserve β-cell identity and function in a pro-inflammatory environment.