Activating transcription factor 3 (ATF3) is a member of the ATF/cAMP-response element-binding protein family of transcription factors. It is a transcriptional repressor, and the expression of its corresponding gene is induced by stress signals in a variety of tissues, including the liver. In this report, we demonstrate that ATF3 is induced in the pancreas by partial pancreatectomy, streptozotocin treatment, and ischemia coupled with reperfusion. Furthermore, ATF3 is induced in cultured islet cells by oxidative stress. Interestingly, transgenic mice expressing ATF3 in the liver and pancreas under the control of the transthyretin promoter have defects in glucose homeostasis and perinatal lethality. We present evidence that expression of ATF3 in the liver represses the expression of genes encoding gluconeogenic enzymes. Furthermore, expression of ATF3 in the pancreas leads to abnormal endocrine pancreas and reduced numbers of hormone-producing cells. Analyses of embryos indicated that the ATF3 transgene is expressed in the ductal epithelium in the developing pancreas, and the transgenic pancreas has fewer mitotic cells than the non-transgenic counterpart, providing a potential explanation for the reduction of endocrine cells. Because ATF3 is a stress-inducible gene, these mice may represent a model to investigate the molecular mechanisms for some stress-associated diseases.