Mutations in genes encoding HNF-4alpha, HNF-1alpha and IPF-1/Pdx-1 are associated with, respectively, MODY subtypes-1, -3 and -4. Impaired glucose-stimulated insulin secretion is the common primary defect of these monogenic forms of diabetes. A regulatory circuit between these three transcription factors has also been suggested. We aimed to explore how Pdx-1 regulates beta cell function and gene expression patterns. We studied two previously established INS-1 stable cell lines permitting inducible expression of, respectively, Pdx-1 and its dominant-negative mutant. We used HPLC for insulin processing, adenovirally encoded aequorin for cytosolic [Ca2+], and transient transfection of human growth hormone or patch-clamp capacitance recordings to monitor exocytosis. Induction of DN-Pdx-1 resulted in defective glucose-stimulated and K+-depolarisation-induced insulin secretion in INS-1 cells, while overexpression of Pdx-1 had no effect. We found that DN-Pdx-1 caused down-regulation of fibroblast growth factor receptor 1 (FGFR1), and consequently prohormone convertases (PC-1/3 and -2). As a result, DN-Pdx-1 severely impaired proinsulin processing. In addition, induction of Pdx-1 suppressed the expression of glucagon-like peptide 1 receptor (GLP-1R), which resulted in marked reduction of both basal and GLP-1 agonist exendin-4-stimulated cellular cAMP levels. Induction of DN-Pdx-1 did not affect glucokinase activity, glycolysis, mitochondrial metabolism or ATP generation. The K+-induced cytosolic [Ca2+] rise and Ca2+-evoked exocytosis (membrane capacitance) were not abrogated. The severely impaired proinsulin processing combined with decreased GLP-1R expression and cellular cAMP content, rather than metabolic defects or altered exocytosis, may contribute to the beta cell dysfunction induced by Pdx-1 deficiency.