Impaired glucose stimulated insulin secretion is a prominent, early defect in type 2 diabetes. Insulin secretion is coupled to glucose metabolism by effects of the intracellular ATP/ADP ratio on the multimeric beta-cell potassium channel. The sulfonylurea receptor (SUR1 or ABCC8), the regulatory subunit of that channel, binds sulfonylurea agents and thus closes the channel and stimulates exocytosis of insulin-containing granules. alpha-Endosulfine (ENSA), has been proposed as the endogenous ligand for SUR1. We mapped ENSA in silico to chromosome 1q21 near a confirmed type 2 diabetes susceptibility locus, and derived the genomic structure of four exons and three introns. We identified four single nucleotide polymorphisms (SNP) and one insertion deletion polymorphism among 16 Caucasian and 16 African-American diabetic individuals. Only one SNP was common to both ethnic groups, and no SNP altered the coding sequence. No variant was associated with type 2 diabetes in Caucasian or African-American studies, but a single SNP in intron 3 (SNP 17) was associated with a reduced disposition index (insulin sensitivity x acute insulin response to glucose) in interaction with family membership in 126 members of 26 Caucasian families. Individuals homozygous for the rare allele showed a 70% reduction in insulin secretion (disposition index) relative to all other genotypes. Our data do not suggest that ENSA could explain the linkage of T2DM to this region, but ENSA SNP 17 may have an important role in reducing the ability of the beta-cell to compensate for reduced insulin sensitivity, which in turn would increase the susceptibility to T2DM.