Melatonin is a circulating hormone that is primarily released from the pineal gland. It is best known as a regulator of seasonal and circadian rhythms; its levels are high during the night and low during the day. Interestingly, insulin levels also exhibit a nocturnal drop, which has previously been suggested to be controlled, at least in part, by melatonin. This regulation can be explained by the proposed inhibitory action of melatonin on insulin release. Indeed, both melatonin receptor 1A (MTNR1A) and MTNR1B are expressed in pancreatic islets. The role of melatonin in the regulation of glucose homeostasis has been highlighted by three independent publications based on genome-wide association studies of traits connected with type 2 diabetes, such as elevated fasting glucose, and, subsequently, of the disease itself. The studies demonstrate a link between variations in the MTNR1B gene, hyperglycaemia, impaired early phase insulin secretion and beta cell function. The risk genotype predicts the future development of type 2 diabetes. Carriers of the risk genotype exhibit increased expression of MTNR1B in islets. This suggests that these individuals may be more sensitive to the actions of melatonin, leading to impaired insulin secretion. Blocking the inhibition of insulin secretion by melatonin may be a novel therapeutic avenue for type 2 diabetes.