12-Lipoxygenase (12-LOX) is a key enzyme in arachidonic acid metabolism, and alongside its major product, 12-HETE, plays a key role in promoting inflammatory signaling during diabetes pathogenesis. Although 12-LOX is a proposed therapeutic target to protect pancreatic islets in the setting of diabetes, little is known about the consequences of blocking its enzymatic activity during embryonic development. Here, we have leveraged the strengths of the zebrafish-genetic manipulation and pharmacologic inhibition-to interrogate the role of 12-LOX in pancreatic development. Lipidomics analysis during zebrafish development demonstrated that 12-LOX-generated metabolites of arachidonic acid increase sharply during organogenesis stages, and that this increase is blocked by morpholino-directed depletion of 12-LOX. Furthermore, we found that either depletion or inhibition of 12-LOX impairs both exocrine pancreas growth and unexpectedly, the generation of insulin-producing β cells. We demonstrate that morpholino-mediated knockdown of GPR31, a purported G-protein-coupled receptor for 12-HETE, largely phenocopies both the depletion and the inhibition of 12-LOX. Moreover, we show that loss of GPR31 impairs pancreatic bud fusion and pancreatic duct morphogenesis. Together, these data provide new insight into the requirement of 12-LOX in pancreatic organogenesis and islet formation, and additionally provide evidence that its effects are mediated via a signaling axis that includes the 12-HETE receptor GPR31.