Emerging data indicate that central neurons participate in diabetic processes by modulating autonomic output from neurons in the dorsal motor nucleus of the vagus (DMV). We tested the hypothesis that synaptic modulation by transient receptor potential vanilloid type 1 (TRPV1) receptors is reduced in the DMV in slices from a murine model of type 1 diabetes. The TRPV1 agonist capsaicin robustly enhanced glutamate release onto DMV neurons by acting at preterminal receptors in slices from intact mice, but failed to do so in slices from diabetic mice. TRPV1 receptor protein expression in the vagal complex was unaltered. Brief insulin preapplication restored TRPV1-dependent modulation of glutamate release in a PKC- and PI3K-dependent manner. The restorative effect of insulin was prevented by brefeldin A, suggesting that insulin induced TRPV1 receptor trafficking to the terminal membrane. Central vagal circuits critical to the autonomic regulation of metabolism undergo insulin-dependent synaptic plasticity involving TRPV1 receptor modulation in diabetic mice after several days of chronic hyperglycemia.