Sustained hyperglycemia results in excess protein O-GlcNAcylation, leading to vascular complications in diabetes. This study aims to investigate the role of O-GlcNAcylation in the progression of coronary microvascular disease (CMD) in inducible type 2 diabetic (T2D) mice generated by a high-fat diet with a single injection of low-dose streptozotocin. Inducible T2D mice exhibited an increase in protein O-GlcNAcylation in cardiac endothelial cells (CECs) and decreases in coronary flow velocity reserve (CFVR, an indicator of coronary microvascular function) and capillary density accompanied by increased endothelial apoptosis in the heart. Endothelial-specific O-GlcNAcase (OGA) overexpression significantly lowered protein O-GlcNAcylation in CECs, increased CFVR and capillary density, and decreased endothelial apoptosis in T2D mice. OGA overexpression also improved cardiac contractility in T2D mice. OGA gene transduction augmented angiogenic capacity in high-glucose treated CECs. PCR array analysis revealed that seven out of 92 genes show significant differences among control, T2D, and T2D + OGA mice, and Sp1 might be a great target for future study, the level of which was significantly increased by OGA in T2D mice. Our data suggest that reducing protein O-GlcNAcylation in CECs has a beneficial effect on coronary microvascular function, and OGA is a promising therapeutic target for CMD in diabetic patients.