Although compensatory islet hyperplasia in response to insulin resistance is a recognized feature in diabetes, the factor(s) that promote β cell proliferation have been elusive. We previously reported that the liver is a source for such factors in the liver insulin receptor knockout (LIRKO) mouse, an insulin resistance model that manifests islet hyperplasia. Using proteomics we show that serpinB1, a protease inhibitor, which is abundant in the hepatocyte secretome and sera derived from LIRKO mice, is the liver-derived secretory protein that regulates β cell proliferation in humans, mice, and zebrafish. Small-molecule compounds, that partially mimic serpinB1 effects of inhibiting elastase activity, enhanced proliferation of β cells, and mice lacking serpinB1 exhibit attenuated β cell compensation in response to insulin resistance. Finally, SerpinB1 treatment of islets modulated proteins in growth/survival pathways. Together, these data implicate serpinB1 as an endogenous protein that can potentially be harnessed to enhance functional β cell mass in patients with diabetes.