Pancreatic β cells are responsible for maintaining glucose homeostasis; their absence or malfunction results in diabetes mellitus. Although there is evidence that long noncoding RNAs (lncRNAs) play important roles in development and disease, none have been investigated in vivo in the context of pancreas development. In this study, we demonstrate that βlinc1 (β-cell long intergenic noncoding RNA 1), a conserved lncRNA, is necessary for the specification and function of insulin-producing β cells through the coordinated regulation of a number of islet-specific transcription factors located in the genomic vicinity of βlinc1. Furthermore, deletion of βlinc1 results in defective islet development and disruption of glucose homeostasis in adult mice.