Glucagon-like peptide-1(7-36)amide (GLP-1) possesses several unique and beneficial effects for the potential treatment of type 2 diabetes. However, the rapid inactivation of GLP-1 by dipeptidyl peptidase IV (DPP IV) results in a short half-life in vivo (less than 2 min) hindering therapeutic development. In the present study, a novel His7-modified analogue of GLP-1, N-pyroglutamyl-GLP-1 as well as N-acetyl-GLP-1 were synthesised and tested for DPP IV stability and biological activity. Incubation of GLP-1 with either DPP IV or human plasma resulted in rapid degradation of native GLP-1 to GLP-1(9-36)amide, while N-acetyl-GLP-1 and N-pyroglutamyl-GLP-1 were completely resistant to degradation. N-acetyl-GLP-1 and N-pyroglutamyl-GLP-1 bound to the GLP-1 receptor but had reduced affinities (IC50 values 32.9 and 6.7 nM, respectively) compared with native GLP-1 (IC50-37 nM). Similarly, both analogues stimulated cAMP production with EC50 values of 16.3 and 27 nM respectively compared with GLP-1 (EC50 4.7 nM). However, N-acetyl-GLP-1 and N-pyroglutamyl-GLP-1 exhibited potent insulinotropic activity in vitro at 5.6 mM glucose (P< 0.05 to P< 0.001) similar to native GLP-1. Both analogues (25 nM/kg body weight) lowered plasma glucose and increased plasma insulin levels when administered in conjunction with glucose (18 nM/kg body weight) to adult obese diabetic (ob/ob) mice. N-pyroglutamyl-GLP-1 was substantially better at lowering plasma glucose compared with the native peptide, while N-acetyl-GLP-1 was significantly more potent at stimulating insulin secretion. These studies indicate that N-terminal modification of GLP-1 results in DPP IV-resistant and biologically potent forms of GLP-1. The particularly powerful antihyperglycaemic action of N-pyroglutamyl-GLP-1 shows potential for the treatment of type 2 diabetes. © 2004 Society for Endocrinology.