Pituitary adenylate cyclase-activating peptide (PACAP) and vasoactive intestinal peptide (VIP) activate two shared receptors, VPAC1 and VPAC2. Activation of VPAC1 has been implicated in elevating glucose output, whereas activation of VPAC2 may be involved in insulin secretion. A hypothesis that a VPAC2-selective agonist would enhance glucose disposal by stimulating insulin secretion without causing increased hepatic glucose production was tested using a novel selective agonist of VPAC2. This agonist, BAY 55-9837, was generated through site-directed mutagenesis based on sequence alignments of PACAP, VIP, and related analogs. The peptide bound to VPAC2 with a dissociation constant (K(d)) of 0.65 nmol/l and displayed >100-fold selectivity over VPAC1. BAY 55-9837 stimulated glucose-dependent insulin secretion in isolated rat and human pancreatic islets, increased insulin synthesis in purified rat islets, and caused a dose-dependent increase in plasma insulin levels in fasted rats, with a half-maximal stimulatory concentration of 3 pmol/kg. Continuous intravenous or subcutaneous infusion of the peptide reduced the glucose area under the curve following an intraperitoneal glucose tolerance test. The peptide had effects on intestinal water retention and mean arterial blood pressure in rats, but only at much higher doses. BAY 55-9837 may be a useful therapy for the treatment of type 2 diabetes.