Autophagy is a cellular degradation-recycling system for aggregated proteins and damaged organelles. Although dysregulated autophagy is implicated in various diseases including neurodegeneration, its role in pancreatic beta cells and glucose homeostasis has not been described. We produced mice with beta cell-specific deletion of Atg7 (autophagy-related 7). Atg7 mutant mice showed impaired glucose tolerance and decreased serum insulin level. beta cell mass and pancreatic insulin content were reduced because of increased apoptosis and decreased proliferation of beta cells. Physiological studies showed reduced basal and glucose-stimulated insulin secretion and impaired glucose-induced cytosolic Ca2+ transients in autophagy-deficient beta cells. Morphologic analysis revealed accumulation of ubiquitinated protein aggregates colocalized with p62, which was accompanied by mitochondrial swelling, endoplasmic reticulum distension, and vacuolar changes in beta cells. These results suggest that autophagy is necessary to maintain structure, mass and function of pancreatic beta cells, and its impairment causes insulin deficiency and hyperglycemia because of abnormal turnover and function of cellular organelles.