OBJECTIVE - Common variants in the gene TCF7L2 confer the largest effect on the risk of type 2 diabetes. The present study was undertaken to increase our understanding of the mechanisms by which this gene affects type 2 diabetes risk. RESEARCH DESIGN AND METHODS - Eight subjects with risk-conferring TCF7L2 genotypes (TT or TC at rs7903146) and 10 matched subjects with wild-type genotype (CC) underwent 5-h oral glucose tolerance test (OGTT), isoglycemic intravenous glucose infusion, and graded glucose infusion (GGI). Mathematical modeling was used to quantify insulin-secretory profiles during OGTT and glucose infusion protocols. The incretin effect was assessed from ratios of the insulin secretory rates (ISR) during oral and isoglycemic glucose infusions. Dose-response curves relating insulin secretion to glucose concentrations were derived from the GGI. RESULTS - β-cell responsivity to oral glucose was 50% lower (47 ± 4 vs. 95 ± 15 × 109 min -1; P = 0.01) in the group of subjects with risk-conferring TCF7L2 genotypes compared with control subjects. The incretin effect was also reduced by 30% (32 ± 4 vs. 46 ± 4%; P = 0.02) in the at-risk group. The lower incretin effect occurred despite similar glucose-dependent insulinotropic polypeptide (GIP) and glucagon-like peptide 1 (GLP-1) responses to oral glucose. The ISR response to intravenous glucose over a physiologic glucose concentration range (5-9 mmol/l) was similar between groups. CONCLUSIONS - The TCF7L2 variant rs7903146 appears to affect risk of type 2 diabetes, at least in part, by modifying the effect of incretins on insulin secretion. This is not due to reduced secretion of GLP-1 and GIP but rather due to the effect of TCF7L2 on the sensitivity of the β-cell to incretins. Treatments that increase incretin sensitivity may decrease the risk of type 2 diabetes.