Aristaless related homeodomain protein (Arx) specifies the formation of the pancreatic islet α-cell during development. This cell type produces glucagon, a major counteracting hormone to insulin in regulating glucose homeostasis in adults. However, little is known about the factors that regulate Arx transcription in the pancreas. In this study, we showed that the number of Arx+ cells was significantly reduced in the pancreata of embryos deficient for the Islet-1 (Isl-1) transcription factor, which was also supported by the reduction in Arx mRNA levels. Chromatin immunoprecipitation analysis localized Isl-1 activator binding sites within two highly conserved noncoding regulatory regions (Re) in the Arx locus, termed Re1 (+5.6 to +6.1 kb) and Re2 (+23.6 to +24 kb). Using cell line-based transfection assays, we demonstrated that a Re1-and Re2-driven reporter was selectively activated in islet α-cells, a process mediated by Isl-1 in overexpression, knockdown, and site-directed mutation experiments. Moreover, Arx mRNA levels were upregulated in islet α-cells upon Isl-1 overexpression in vivo. Isl-1 represents the first known activator of Arx transcription in α-cells, here established to be acting through the conserved Re1 and Re2 control domains. © 2011 by The American Society for Biochemistry and Molecular Biology, Inc.