Abstract Disclosure: J. Hand: None. S. Nemiroff: None. C. Zmijewski: None. C.J. Levy: None. Introduction: Insulin-induced localized lipoatrophy is a rare phenomenon that involves the loss of subcutaneous adipose tissue around sites of insulin injections, and it often presents as a deep, retracted scar on the skin. Its prevalence has dropped significantly given improvements in recombinant and purified insulin and its analogs, from 55% to more recently 1-2%. Lipoatrophy can cause erratic absorption of insulin, leading to suboptimal glycemic control and hypoglycemia. The pathophysiology is not completely understood but is thought to be immune-mediated. Treatment options are limited and often focus on rotating injection sites or changing the type of insulin, though some case reports alternatively describe using corticosteroid injections. Here, we report an unusual case where a patient developed a form of early, localized lipoatrophy called lipoatrophic panniculitis due to insulin. Clinical Case: A 28-year-old male with a 13-year history of type 1 diabetes presented for insulin optimization. The patient was using multiple daily injection (MDI) insulin therapy and later an insulin pump, with careful infusion site rotation. Seven years later, he experienced issues with his pump sites, developing nodules and bruises that became painful and caused labile glycemic control. He underwent dermatologic, rheumatologic, and allergic workup with two biopsies confirming insulin-induced lipoatrophic panniculitis. Immunosuppressive and varying insulin regimens were unsuccessful. Hydroxychloroquine and methotrexate showed limited improvement with intolerable gastrointestinal side effects. Trials of hydrocortisone in his insulin infusion or topical clobetasol with tacrolimus provided no benefit. Various MDI regimens with different concentrations of lispro, aspart, faster aspart, glargine, detemir, and degludec were tried; all elicited varying degrees of pain with suboptimal glycemic response. A supervised trial of inhaled insulin was associated with bronchospasms. An implantable insulin pump was sought through clinical trials but was not feasible due to eligibility. Ultimately, he was successfully referred for pancreas transplantation due to his labile and complicated diabetes, but the procedure was complicated by allograft thrombosis and failure. He is currently awaiting a second transplant. Clinical Lesson: There are few reports of patients with insulin-induced lipoatrophic panniculitis in the literature. It is an important differential to consider for a patient that is having unexpected glycemic excursions, and it is equally as challenging to select an adequate management regimen. Treatment is limited and a broad range of options need to be considered. When these patients fail mainstay immunosuppressive, corticosteroid, and insulin-based management, pancreas transplantation may be considered as an alternative feasible treatment. Presentation: 6/1/2024