Genistein, a flavonoid in legumes and some herbal medicines, has various biological actions. However, studies on whether genistein has an effect on pancreatic β-cell function are very limited. In the present study, we investigated the effect of genistein on β-cell proliferation and cellular signaling related to this effect and further determined its antidiabetic potential in insulin-deficient diabetic mice. Genistein induced both INS1 and human islet β-cell proliferation after 24 h of incubation, with 5 μm genistein inducing a maximal 27% increase. The effect of genistein on β-cell proliferation was neither dependent on estrogen receptors nor shared by 17β-estradiol or a host of structurally related flavonoid compounds. Pharmacological or molecular intervention of protein kinase A (PKA) or ERK1/2 completely abolished genistein-stimulated β-cell proliferation, suggesting that both molecules are essential for genistein action. Consistent with its effect on cell proliferation, genistein induced cAMP/PKA signaling and subsequent phosphorylation of ERK1/2 in both INS1 cells and human islets. Furthermore, genistein induced protein expression of cyclin D1, a major cell-cycle regulator essential for β-cell growth. Dietary intake of genistein significantly improved hyperglycemia, glucose tolerance, and blood insulin levels in streptozotocin-induced diabetic mice, concomitant with improved islet β-cell proliferation, survival, and mass. These results demonstrate that genistein may be a natural antidiabetic agent by directly modulating pancreatic β-cell function via activation of the cAMP/PKA-dependent ERK1/2 signaling pathway.