Type 2 diabetes is one of the most prevalent and serious metabolic diseases in the world, and insulin resistance and pancreatic beta-cell dysfunction are the hallmarks of the disease. In this study, we have shown that endoplasmic reticulum (ER) stress, which is provoked under diabetic conditions, plays a crucial role in the insulin resistance found in diabetes by modifying the expression of oxygen-regulated protein 150 (ORP150), a molecular chaperone that protects cells from ER stress. Sense ORP overexpression in the liver of obese diabetic mice significantly improved insulin resistance and markedly ameliorated glucose tolerance. Conversely, expression of antisense ORP150 in the liver of normal mice decreased insulin sensitivity. The phosphorylation state of IRS-1 and Akt, which are key molecules for insulin signaling, and the expression levels of phosphoenolpyruvate carboxykinase and glucose-6-phosphatase, key enzymes of gluconeogenesis, were also altered by ORP150 overexpression. This is the first report showing that ER stress plays a crucial role in the insulin resistance found in diabetes and thus could be a potential therapeutic target for diabetes.