Mitochondrial dysfunction is an important contributor to human pathology and it is estimated that mutations of mitochondrial DNA (mtDNA) cause approximately 0.5-1% of all types of diabetes mellitus. We have generated a mouse model for mitochondrial diabetes by tissue-specific disruption of the nuclear gene encoding mitochondrial transcription factor A (Tfam, previously mtTFA; ref. 7) in pancreatic beta-cells. This transcriptional activator is imported to mitochondria, where it is essential for mtDNA expression and maintenance. The Tfam-mutant mice developed diabetes from the age of approximately 5 weeks and displayed severe mtDNA depletion, deficient oxidative phosphorylation and abnormal appearing mitochondria in islets at the ages of 7-9 weeks. We performed physiological studies of beta-cell stimulus-secretion coupling in islets isolated from 7-9-week-old mutant mice and found reduced hyperpolarization of the mitochondrial membrane potential, impaired Ca(2+)-signalling and lowered insulin release in response to glucose stimulation. We observed reduced beta-cell mass in older mutants. Our findings identify two phases in the pathogenesis of mitochondrial diabetes; mutant beta-cells initially display reduced stimulus-secretion coupling, later followed by beta-cell loss. This animal model reproduces the beta-cell pathology of human mitochondrial diabetes and provides genetic evidence for a critical role of the respiratory chain in insulin secretion.