Abstract Aims/hypothesis Diabetes mellitus is associated with impaired insulin secretion, often aggravated by oversecretion of glucagon. Therapeutic interventions should ideally correct both defects. Glucagon-like peptide 1 (GLP-1) has this capability but exactly how it exerts its glucagonostatic effect remains obscure. Following its release GLP-1 is rapidly degraded from GLP-1(7–36) to GLP-1(9–36). We hypothesised that the metabolite GLP-1(9–36) (previously believed to be biologically inactive) exerts a direct inhibitory effect on glucagon secretion and that this mechanism becomes impaired in diabetes. Methods We used a combination of glucagon secretion measurements in mouse and human islets (including islets from donors with type 2 diabetes), total internal reflection fluorescence microscopy imaging of secretory granule dynamics, recordings of cytoplasmic Ca²⁺ and measurements of protein kinase A activity, immunocytochemistry, in vivo physiology and GTP-binding protein dissociation studies to explore how GLP-1 exerts its inhibitory effect on glucagon secretion and the role of the metabolite GLP-1(9–36). Results GLP-1(7–36) inhibited glucagon secretion in isolated islets with an IC₅₀ of 2.5 pmol/l. The effect was particularly strong at low glucose concentrations. The degradation product GLP-1(9–36) shared this capacity. GLP-1(9–36) retained its glucagonostatic effects after genetic/pharmacological inactivation of the GLP-1 receptor. GLP-1(9–36) also potently inhibited glucagon secretion evoked by β-adrenergic stimulation, amino acids and membrane depolarisation. In islet alpha cells, GLP-1(9–36) led to inhibition of Ca²⁺ entry via voltage-gated Ca²⁺ channels sensitive to ω-agatoxin, with consequential pertussis-toxin-sensitive depletion of the docked pool of secretory granules, effects that were prevented by the glucagon receptor antagonists REMD2.59 and L-168049. The capacity of GLP-1(9–36) to inhibit glucagon secretion and reduce the number of docked granules was lost in alpha cells from human donors with type 2 diabetes. In vivo, high exogenous concentrations of GLP-1(9–36) (>100 pmol/l) resulted in a small (30%) lowering of circulating glucagon during insulin-induced hypoglycaemia. This effect was abolished by REMD2.59, which promptly increased circulating glucagon by >225% (adjusted for the change in plasma glucose) without affecting pancreatic glucagon content. Conclusions/interpretation We conclude that the GLP-1 metabolite GLP-1(9–36) is a systemic inhibitor of glucagon secretion. We propose that the increase in circulating glucagon observed following genetic/pharmacological inactivation of glucagon signalling in mice and in people with type 2 diabetes reflects the removal of GLP-1(9–36)’s glucagonostatic action. Graphical Abstract