Neuropeptide Y (NPY), whose role in appetite regulation is well known, is also expressed in pancreatic islets. Although previous studies indicated that exogenous NPY to pancreatic islets inhibits insulin secretion, its physiological role in the regulation of insulin secretion is not fully understood. We hypothesized that endogenous NPY in islets tonically suppresses insulin secretion and the reduction of islet NPY increases insulin secretion. To address the hypothesis, islet function of NPY deficient mice was analyzed. Although there was little change in glucose homeostasis in vivo, pancreatic islets from NPY deficient mice had higher basal insulin secretion (1.9 times), glucose-stimulated insulin secretion (2.4 times), and islet mass (1.7 times) compared with wild-type mouse. Next we sought to determine whether the expression of NPY and Y₁ receptor in islets was altered in hyperinsulinemia associated with obesity. Islets from C57Bl/6J mice on high fat diet (DIO) had 1.9 times higher basal insulin secretion and 2.4 times higher glucose-stimulated insulin secretion than control mice indicating islet adaptation to obesity. Expression of NPY and Y₁ receptor mRNA levels was decreased by 70% and 64% respectively in DIO islets compared with controls. NPY and Y₁ receptor in islets were also reduced by 91% and 80% respectively in leptin-deficient ob/ob mice that showed marked hyperinsulinemia. Together, these results suggest that endogenous NPY tonically inhibits insulin secretion from islets and a reduction of islet NPY may serve one of the mechanisms to increase insulin secretion when islets compensate for insulin resistance associated with obesity.