Arachidonic acid (AA) is one of only two unsaturated fatty acids retained in the ovaries of crustaceans, and an inhibitor of HR97g, a nuclear receptor expressed in adult ovaries. We hypothesized that as a key fatty acid, AA may be associated with reproduction and potentially environmental sex determination in Daphnia. Reproduction assays with AA indicate that it alters female/male sex ratios by increasing female production. This reproductive effect only occurred during a restricted P. subcapitata diet. Next, we tested whether enriching a poorer algal diet (C. vulgaris) with AA enhances overall reproduction and sex ratios. AA enrichment of a C. vulgaris diet also enhances fecundity at 1.0 and 4.0μM by 30–40% in the presence and absence of pyriproxyfen. This indicates that AA is crucial in reproduction regardless of environmental sex determination. Furthermore, our data indicates that P. subcapitata may provide a threshold concentration of AA needed for reproduction. Diet switch experiments from P. subcapitata to C. vulgaris mitigate some but not all of AA’s effects when compared to a C. vulgaris only diet, suggesting that some AA provided by P. subcapitata is retained. In summary, AA supplementation increases reproduction and represses pyriproxyfen-induced environmental sex determination in D. magna in restricted diets. A diet rich in AA may provide protection from some reproductive toxicants such as the juvenile hormone agonist, pyriproxyfen.