CD59 is a glycosylphosphatidylinositol (GPI)-anchored cell surface inhibitor of the complement membrane attack complex (MAC). We showed previously that CD59 is highly expressed in pancreatic islets but is down-regulated in rodent models of diabetes. CD59 knockdown but not enzymatic removal of cell surface CD59 led to a loss of glucose-stimulated insulin secretion (GSIS), suggesting that an intracellular pool of CD59 is required. In this current paper, we now report that non–GPI-anchored CD59 is present in the cytoplasm, colocalizes with exocytotic protein vesicle-associated membrane protein 2, and completely rescues GSIS in cells lacking endogenous CD59 expression. The involvement of cytosolic non–GPI-anchored CD59 in GSIS is supported in phosphatidylinositol glycan class A knockout GPI anchor–deficient β-cells, in which GSIS is still CD59 dependent. Furthermore, site-directed mutagenesis demonstrated different structural requirements of CD59 for its 2 functions, MAC inhibition and GSIS. Our results suggest that CD59 is retrotranslocated from the endoplasmic reticulum to the cytosol, a process mediated by recognition of trimmed N-linked oligosaccharides, supported by the partial glycosylation of non–GPI-anchored cytosolic CD59 as well as the failure of N-linked glycosylation site mutant CD59 to reach the cytosol or rescue GSIS. This study thus proposes the previously undescribed existence of non–GPI-anchored cytosolic CD59, which is required for insulin secretion.—Golec, E., Rosberg, R., Zhang, E., Renström, E., Blom, AM, King, BC A cryptic non–GPI-anchored cytosolic isoform of CD59 controls insulin exocytosis in pancreatic β-cells by interaction with SNARE proteins.