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Protein S is an anticoagulant factor that also regulates inflammation and cell apoptosis. The effect of protein S on diabetes and its complications is unknown. This study compared the development of diabetes between wild-type and transgenic mice overexpressing human protein S and the development of diabetic glomerulosclerosis between mice treated with and without human protein S and between wild-type and protein S transgenic mice. Mice overexpressing protein S showed significant improvements in blood glucose level, glucose tolerance, insulin sensitivity, and insulin secretion compared with wild-type counterparts. Exogenous protein S improved insulin sensitivity in adipocytes, skeletal muscle, and liver cell lines in db/db mice compared with controls. Significant inhibition of apoptosis with increased expression of BIRC3 and Bcl-2 and enhanced activation of Akt/PKB was induced by protein S in islet β-cells compared with controls. Diabetic wild-type mice treated with protein S and diabetic protein S transgenic mice developed significantly less severe diabetic glomerulosclerosis than controls. Patients with type 2 diabetes had significantly lower circulating free protein S than healthy control subjects. This study shows that protein S attenuates diabetes by inhibiting apoptosis of β-cells and the development of diabetic nephropathy. [ABSTRACT FROM AUTHOR]