Type 2 diabetes mellitus is associated with alterations in bile acid (BA) signaling. The aim of our study was to test whether pancreatic β-cells contribute to BA-dependent regulation of glucose homeostasis. Experiments were performed with islets from wild-type, farnesoid X receptor (FXR) knockout (KO), and β-cell ATP-dependent K⁺ (K_ATP) channel gene SUR1 (ABCC8) KO mice, respectively. Sodium taurochenodeoxycholate (TCDC) increased glucose-induced insulin secretion. This effect was mimicked by the FXR agonist GW4064 and suppressed by the FXR antagonist guggulsterone. TCDC and GW4064 stimulated the electrical activity of β-cells and enhanced cytosolic Ca²⁺ concentration ([Ca²⁺]_c). These effects were blunted by guggulsterone. Sodium ursodeoxycholate, which has a much lower affinity to FXR than TCDC, had no effect on [Ca²⁺]_c and insulin secretion. FXR activation by TCDC is suggested to inhibit K_ATP current. The decline in K_ATP channel activity by TCDC was only observed in β-cells with intact metabolism and was reversed by guggulsterone. TCDC did not alter insulin secretion in islets of SUR1-KO or FXR-KO mice. TCDC did not change islet cell apoptosis. This is the first study showing an acute action of BA on β-cell function. The effect is mediated by FXR by nongenomic elements, suggesting a novel link between FXR activation and K_ATP channel inhibition.