Krüppel-like transcription factors (KLFs) have elicited significant attention because of their regulation of essential biochemical pathways and, more recently, because of their fundamental role in the mechanisms of human diseases. Neonatal diabetes mellitus is a monogenic disorder with primary alterations in insulin secretion. We here describe a key biochemical mechanism that underlies neonatal diabetes mellitus insulin biosynthesis impairment, namely a homozygous mutation within the insulin gene (INS) promoter, c.-331C>G, which affects a novel KLF-binding site. The combination of careful expression profiling, electromobility shift assays, reporter experiments, and chromatin immunoprecipitation demonstrates that, among 16 different KLF proteins tested, KLF11 is the most reliable activator of this site. Congruently, the c.-331C>G INS mutation fails to bind KLF11, thus inhibiting activation by this transcription factor. Klf11−/− mice recapitulate the disruption in insulin production and blood levels observed in patients. Thus, these data demonstrate an important role for KLF11 in the regulation of INS transcription via the novel c.-331 KLF site. Lastly, our screening data raised the possibility that other members of the KLF family may also regulate this promoter under distinct, yet unidentified, cellular contexts. Collectively, this study underscores a key role for KLF proteins in biochemical mechanisms of human diseases, in particular, early infancy onset diabetes mellitus.