The intracellular chloride concentration ([Cl(-)](i)) in β-cells plays an important role in glucose-stimulated plasma membrane depolarisation and insulin secretion. [Cl(-)](i) is maintained above equilibrium in β-cells by the action of Cl(-) co-transporters of the solute carrier family 12 group A (Slc12a). β-Cells express Slc12a1 and Slc12a2, which are known as the bumetanide (BTD)-sensitive Na(+)-dependent K(+)2Cl(-) co-transporters 2 and 1 respectively. We show that mice lacking functional alleles of the Slc12a2 gene exhibit better fasting glycaemia, increased insulin secretion in response to glucose, and improved glucose tolerance when compared with wild-type (WT). This phenomenon correlated with increased sensitivity of β-cells to glucose in vitro and with increased β-cell mass. Further, administration of low doses of BTD to mice deficient in Slc12a2 worsened their glucose tolerance, and low concentrations of BTD directly inhibited glucose-stimulated insulin secretion from β-cells deficient in Slc12a2 but expressing intact Slc12a1 genes. Together, our results suggest for the first time that the Slc12a2 gene is not necessary for insulin secretion and that its absence increases β-cell secretory capacity. Further, impairment of insulin secretion with BTD in vivo and in vitro in islets lacking Slc12a2 genes unmasks a potential new role for Slc12a1 in β-cell physiology.