Among the identified thousands of circular RNAs (circRNA) in humans and animals, Cdr1as (also known as CiRS-7) was recently demonstrated to act as a powerful miR-7 sponge/inhibitor in developing midbrain of zebrafish, suggesting a novel mechanism for regulating microRNA functions. MiR-7 is abundantly expressed in islet cells, but overexpressing miR-7 in transgenic mouse β cells causes diabetes. Therefore, we infer that Cdr1as expression may inhibit miR-7 function in islet cells, which in turn improves insulin secretion. Here, we show the first characterization of Cdr1as expression in islet cells, which was upregulated by long-term forskolin and PMA stimulation, but not high glucose, indicating the involvement of cAMP and PKC pathways. Remarkably, both insulin content and secretion were significantly increased by overexpression of Cdr1as in islet cells. We further identified a new target Myrip in the Cdr1as/miR-7 pathway that regulates insulin granule secretion, and also another target Pax6 that enhances insulin transcription. Taken together, our findings revealed the effects of the strongly interacting pair of Cdr1as/miR-7 on insulin secretion, which may become a new target for improving β cell function in diabetes.