Islet transplantation is considered to be a curative treatment for type 1 diabetes mellitus. However, disruption of the extracellular matrix (ECM) leads to β-cell destruction and graft dysfunction. In this study, we developed a functionalized self-assembling peptide, KLD-F, with ECM mimic motifs derived from fibronectin and collagen IV, and evaluated its effect on β-cell function and proliferation. Atomic force microscopy and rheological results showed that KLD-F could self-assemble into a nanofibrous scaffold and change into a hydrogel in physiological saline condition. In a three-dimensional cell culture model, KLD-F improved ECM remodeling and cell-cell adhesion of INS-1 β-cells by upregulation of E-cadherin, fibronectin, and collagen IV. KLD-F also enhanced glucose-stimulated insulin secretion and expression of β-cell function genes, including
Glut2
,
Ins1
,
MafA
, and
Pdx-1
in INS-1 cells. Moreover, KLD-F promoted proliferation of INS-1 β-cells and upregulated Ki67 expression by mediating cell cycle progression. In addition, KLD-F improved β-cell function and proliferation via an integrin/focal adhesion kinase/extracellular signal-regulated kinase/cyclin D pathway. This study highlights the fact that the β-cell-ECM interaction reestablished with this functionalized self-assembling peptide is a promising method to improve the therapeutic efficacy of islet transplantation.