What is the central question of this study? Periodic decreases in arterial blood O2 or chronic intermittent hypoxia (CIH) is a hallmark feature of sleep apnoea patients. Despite a large body of clinical evidence linking sleep disordered breathing with apnoeas to diabetes, the causal relationships between CIH and β-cell function and the underlying molecular mechanisms have not been established. What is the main finding and its importance? In a rodent model, we show that mitochondrial oxidative stress generated by CIH leads to pancreatic β-cell dysfunction manifested by augmented basal insulin secretion, insulin resistance, defective proinsulin processing and impaired glucose-stimulated insulin secretion. The results of the present study provide evidence for direct effects of CIH on β-cell function, which may be an underlying molecular mechanism contributing to the development of type 2 diabetes among sleep apnoea patients. Breathing disorders with recurrent apnoea produce periodic decreases in arterial blood O2, i.e. chronic intermittent hypoxia (CIH). Recurrent apnoea patients and CIH-exposed rodents exhibit several co-morbidities, including diabetes. However, the effects of CIH on pancreatic β-cell function are not known. In the present study, we investigated pancreatic β-cell function in C57BL6 mice exposed to 30 days of CIH. Compared with control animals, the CIH-exposed mice exhibited elevated levels of fasting plasma insulin but comparable glucose levels and higher homeostasis model assessment, indicating insulin resistance. Pancreatic β-cell morphology was unaltered in CIH-exposed mice. Insulin content was decreased in CIH-exposed β-cells, and this effect was associated with increased proinsulin levels. The mRNA and protein levels of the enzyme prohormone convertase 1, which converts proinsulin to insulin, were downregulated in CIH-treated islets. More importantly, glucose-stimulated insulin secretion was impaired in CIH-exposed mice and in isolated islets. Mitochondrial levels of reactive oxygen species (ROS) were elevated in CIH-exposed pancreatic islets. Treatment of mice with mito-tempol, a scavenger of mitochondrial ROS, during exposure to CIH prevented the augmented insulin secretion and restored the proinsulin and homeostasis model assessment values to control levels. These results demonstrate that CIH leads to pancreatic β-cell dysfunction, manifested by augmented basal insulin secretion, insulin resistance, defective proinsulin processing, impaired glucose-stimulated insulin secretion and increased mitochondrial ROS, which mediate the effects of CIH on pancreatic β-cell function.