The progression from insulin resistance to type 2 diabetes is caused by the failure of pancreatic beta cells to produce sufficient levels of insulin to meet the metabolic demand. Recent studies indicate that nutrient fluctuations and insulin resistance increase proinsulin synthesis in beta cells beyond the capacity for folding of nascent polypeptides within the endoplasmic reticulum (ER) lumen, thereby disrupting ER homeostasis and triggering the unfolded protein response (UPR). Chronic ER stress promotes apoptosis, at least in part through the UPR-induced transcription factor C/EBP homologous protein (CHOP). We assessed the effect of Chop deletion in multiple mouse models of type 2 diabetes and found that Chop-/- mice had improved glycemic control and expanded beta cell mass in all conditions analyzed. In both genetic and diet-induced models of insulin resistance, CHOP deficiency improved beta cell ultrastructure and promoted cell survival. In addition, we found that isolated islets from Chop-/- mice displayed increased expression of UPR and oxidative stress response genes and reduced levels of oxidative damage. These findings suggest that CHOP is a fundamental factor that links protein misfolding in the ER to oxidative stress and apoptosis in beta cells under conditions of increased insulin demand.