Nesfatin-1 is a novel anorexigenic regulatory peptide. The peptide is the N-terminal part of nucleobindin 2 (NUCB2) and is expressed in brain areas regulating feeding. Outside the brain, nesfatin-1 expression has been reported in adipocytes, gastric endocrine cells and islet cells. We studied NUCB2 expression in human and rodent islets using immunocytochemistry, in situ hybridization and western blot. Furthermore, we investigated the potential influence of nesfatin-1 on secretion of insulin and glucagon in vitro and in vivo in mice and in INS-1 (832/13) cells. The impact of type 2 diabetes (T2D) and glucolipotoxicity on NUCB2 gene expression in human islets and its relationship to insulin secretory capacity and islet gene expression was studied using microarray. Nesfatin-1 immunoreactivity (IR) was abundant in human and rodent beta cells but absent in alpha, delta, PP and ghrelin cells. Importantly, in situ hybridization showed that NUCB2 mRNA is expressed in human and rat islets. Western blot analysis showed that nesfatin-1 IR represented full length NUCB2 in rodent islets. Human islet NUCB2 mRNA was reduced in T2D subjects but upregulated after culture in glucolipotoxic conditions. Furthermore, a positive correlation between NUCB2 and glucagon and insulin gene expression, as well as insulin secretory capacity, was evident. Nesfatin-1 enhanced glucagon secretion but had no effect on insulin secretion from mouse islets or INS-1 (832/13) cells. On the other hand, nesfatin-1 caused a small increase in insulin secretion and reduced glucose during IVGTT in mice. We conclude that nesfatin-1 is a novel glucagon-stimulatory peptide expressed in the beta cell and that its expression is decreased in T2D islets.