In type 2 diabetes, hyperglycemia is present when an increased demand for insulin, typically due to insulin resistance, is not met as a result of progressive pancreatic beta cell dysfunction. This defect in beta cell activity is typically characterized by impaired insulin biosynthesis and secretion, usually accompanied by oxidative and endoplasmic reticulum (ER) stress. We demonstrate that multiple inflammatory cytokines elevated in diabetic pancreatic islets induce beta cell oxidative and ER stress, with interleukin-23 (IL-23), IL-24 and IL-33 being the most potent. Conversely, we show that islet-endogenous and exogenous IL-22, by regulating oxidative stress pathways, suppresses oxidative and ER stress caused by cytokines or glucolipotoxicity in mouse and human beta cells. In obese mice, antibody neutralization of IL-23 or IL-24 partially reduced beta cell ER stress and improved glucose tolerance, whereas IL-22 administration modulated oxidative stress regulatory genes in islets, suppressed ER stress and inflammation, promoted secretion of high-quality efficacious insulin and fully restored glucose homeostasis followed by restitution of insulin sensitivity. Thus, therapeutic manipulation of immune regulators of beta cell stress reverses the hyperglycemia central to diabetes pathology.