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OBJECTIVE—Mammalian target of rapamycin (mTOR) and its downstream target S6 kinase 1 (S6K1) mediate nutrient-induced insulin resistance by downregulating insulin receptor substrate proteins with subsequent reduced Akt phosphorylation. Therefore, mTOR/S6K1 inhibition could become a therapeutic strategy in insulin-resistant states, including type 2 diabetes. We tested this hypothesis in the Psammomys obesus (P. obesus) model of nutrition-dependent type 2 diabetes, using the mTOR inhibitor rapamycin. RESEARCH DESIGN AND METHODS—Normoglycemic and diabetic P. obesus were treated with 0.2 mg · kg−1 · day−1 i.p. rapamycin or vehicle, and the effects on insulin signaling in muscle, liver and islets, and on different metabolic parameters were analyzed. RESULTS—Unexpectedly, rapamycin worsened hyperglycemia in diabetic P. obesus without affecting glycemia in normoglycemic controls. There was a 10-fold increase of serum insulin in diabetic P. obesus compared with controls; rapamycin completely abolished this increase. This was accompanied by weight loss and a robust increase of serum lipids and ketone bodies. Rapamycin decreased muscle insulin sensitivity paralleled by increased glycogen synthase kinase 3β activity. In diabetic animals, rapamycin reduced β-cell mass by 50% through increased apoptosis. Rapamycin increased the stress-responsive c-Jun NH2-terminal kinase pathway in muscle and islets, which could account for its effect on insulin resistance and β-cell apoptosis. Moreover, glucose-stimulated insulin secretion and biosynthesis were impaired in islets treated with rapamycin. CONCLUSIONS—Rapamycin induces fulminant diabetes by increasing insulin resistance and reducing β-cell function and mass. These findings emphasize the essential role of mTOR/S6K1 in orchestrating β-cell adaptation to hyperglycemia in type 2 diabetes. It is likely that treatments based on mTOR inhibition will cause exacerbation of diabetes.