So far, the mechanism that links mitochondrial dysfunction to PDX1 inhibition in the pathogenesis of pancreatic β cell dysfunction under diabetic condition remains largely unclear. This study determined the role of mitochondrial protein FAM3A in regulating PDX1 expression in pancreatic β cells using gain‐ and loss‐of function methods in vitro and in vivo. Within pancreas, FAM3A is highly expressed in β, α, δ, and pp cells of islets. Islet FAM3A expression was correlated with insulin expression under physiological and diabetic conditions. Mice with specific knockout of FAM3A in islet β cells exhibited markedly blunted insulin secretion and glucose intolerance. FAM3A‐deficient islets showed significant decrease in PDX1 expression, and insulin expression and secretion. FAM3A overexpression upregulated PDX1 and insulin expressions, and augmented insulin secretion in cultured islets and β cells. Mechanistically, FAM3A enhanced ATP production to elevate cellular Ca2+ level and promote insulin secretion. Furthermore, FAM3A‐induced ATP release activated CaM to function as a co‐activator of FOXA2, stimulating PDX1 gene transcription. In conclusion, FAM3A plays crucial roles in controlling PDX1 and insulin expressions in pancreatic β cells. Inhibition of FAM3A will trigger mitochondrial dysfunction to repress PDX1 and insulin expressions.