Insig-1 and -2 are closely related proteins of the endoplasmic reticulum (ER) that block proteolytic activation of sterol regulatory element-binding proteins (SREBPs), transcription factors that activate the synthesis of cholesterol and fatty acids in liver and other organs. When cellular cholesterol levels are high, Insig proteins bind and trap SREBP cleavage-activating protein (SCAP), retaining it in the ER and preventing it from escorting SREBPs from ER to the site of proteolytic activation in the Golgi complex. Here, we report the discovery of a liver-specific transcript of Insig-2, designated Insig-2a. This transcript and the ubiquitous transcript, designated Insig-2b, differ through the use of different promoters that produce different noncoding first exons that splice into a common second exon. Although the Insig-2a and -2b mRNAs encode identical proteins, they differ in patterns of regulation. Insig-2a is the predominant transcript in livers of fed animals, and it is selectively down-regulated by insulin. Insig-2a mRNA increases when mice are fasted, and it declines when they are refed. The transcript also increases in livers of rats whose insulin-secreting pancreatic beta cells have been destroyed by streptozotocin, and it is reduced when insulin is injected. The insulin-mediated fall in Insig-2a may allow SREBP-1c to be processed, thereby allowing insulin to stimulate fatty acid synthesis, even under conditions in which hepatic cholesterol levels are elevated.