In the early 1970s, a peptide fraction with insulin potentiating activity was purified from human urine but the identity and origins of the active constituent remained unknown. Here we identify the active component and characterize its origins. The active peptide was identified as an alpha amidated tetrapeptide with the sequence GHTD-amide. The peptide was synthesized and tested for stimulation of glycogen synthesis and insulin potentiation by insulin tolerance testing in insulin-deficient rats, which confirmed GHTD-amide as the active peptide. Tissue localization using a peptide-specific anti-serum and epifluorescent and confocal microscopy showed decoration of pancreatic islets but not other tissues. Confocal microscopy revealed co-localization with insulin and immunogold and electron microscopy showed localization to dense core secretory granules. Consistent with these observations GHTD-amide was found in media conditioned by MIN6 islet beta cells. Sequence database searching found no annotated protein in the human proteome encoding a potential precursor for GHTD-amide. We conclude that the insulin potentiating activity originally described in human urine is attributable to the tetrapeptide GHTD-amide. GHTD-amide is a novel peptide produced by pancreatic beta cells and no precursor protein is present in the annotated human proteome. Stimulation of glycogen synthesis and co-localization with insulin in beta cells suggest that GHTD-amide may play a role in glucose homeostasis by enhancing insulin action and glucose storage in tissues.