Emerging evidence indicates that pancreatic tissue expresses all components of the renin-angiotensin system. However, the functional role is not well understood. This investigation examined renin inhibition on pancreas structure/function in the transgenic Ren2 rat harboring the mouse renin gene, a model of tissue renin overexpression. Renin is the rate-limiting step in the generation of angiotensin II (Ang II), which stimulates the generation of reactive oxygen species in a variety of tissues. Overexpression of renin in Ren2 rats results in hypertension, insulin resistance, and cardiovascular and renal damage. Young (6-7 wk old) insulin-resistant male Ren2 and age-matched insulin sensitive Sprague Dawley rats were treated with the renin inhibitor, aliskiren (50 mg/kg.d by ip injection), or placebo for 21 d. At 21 d, the Ren2 demonstrated insulin resistance with increased islet insulin, Ang II, and reduced total insulin receptor substrate (IRS)-1, IRS-2, and Akt immunostaining. There was increased islet nicotinamide adenine dinucleotide phosphate (NADPH) oxidase activity and subunits (p47(phox) and Rac1) as well as increased nitrotyrosine immunostaining (each P < 0.05). These functional abnormalities were associated with a disordered islet architecture; increased islet-exocrine interface, pericapillary fibrosis, and structurally abnormal mitochondria and content in endocrine and exocrine pancreas. In vivo treatment with aliskiren normalized systemic insulin resistance and islet insulin, Ang II, NADPH oxidase activity/subunits, and nitrotyrosine and improved total IRS-1 and Akt phosphorylation (each P < 0.05) as well as islet/exocrine structural abnormalities. Collectively, these data suggest that pancreatic functional/structural changes are driven, in part, by tissue renin-angiotensin system-mediated increases in NADPH oxidase and reactive oxygen species generation, abnormalities attenuated with direct renin inhibition.