The circadian clock has been shown to regulate metabolic homeostasis. Mice with a deletion of Bmal1, a key component of the core molecular clock, develop hyperglycemia and hypoinsulinemia, suggesting β-cell dysfunction. However, the underlying mechanisms are not fully known. In this study, we investigated the mechanisms underlying the regulation of β-cell function by Bmal1. We studied β-cell function in global Bmal1-/- mice, in vivo and in isolated islets ex vivo, as well as in rat insulinoma cell lines with shRNA-mediated Bmal1 knockdown. Global Bmal1-/- mice develop diabetes secondary to a significant impairment in glucose-stimulated insulin secretion (GSIS). There is a blunting of GSIS in both isolated Bmal1-/- islets and in Bmal1 knockdown cells, as compared to controls, suggesting that this is secondary to a loss of cell-autonomous effect of Bmal1. In contrast to previous studies, in these Bmal1-/- mice on a C57Bl/6 background, the loss of stimulated insulin secretion, interestingly, is with glucose but not to other depolarizing secretagogues, suggesting that events downstream of membrane depolarization are largely normal in Bmal1-/- islets. This defect in GSIS occurs as a result increased mitochondrial uncoupling with consequent impairment of glucose-induced mitochondrial potential generation and ATP synthesis, due to an upregulation of Ucp2. Inhibition of Ucp2, in isolated islets, leads to a rescue of the glucose-induced ATP production and insulin secretion in Bmal1-/- islets. Thus, Bmal1 regulates mitochondrial energy metabolism to maintain normal GSIS and its disruption leads to diabetes due to a loss of GSIS.