Many patients with chronic pancreatitis develop diabetes (chronic pancreatitis–related diabetes [CPRD]) through an undetermined mechanism. Here we used long-term partial pancreatic duct ligation (PDL) as a model to study CPRD. We found that long-term PDL induced significant β-cell dedifferentiation, followed by a time-dependent decrease in functional β-cell mass—all specifically in the ligated tail portion of the pancreas (PDL-tail). High levels of transforming growth factor β1 (TGFβ1) were detected in the PDL-tail and were mainly produced by M2 macrophages at the early stage and by activated myofibroblasts at the later stage. Loss of β-cell mass was then found to result from TGFβ1-triggered epithelial-mesenchymal transition (EMT) by β-cells, rather than resulting directly from β-cell apoptosis. Mechanistically, TGFβ1-treated β-cells activated expression of the EMT regulator gene Snail in a SMAD3/Stat3-dependent manner. Moreover, forced expression of forkhead box protein O1 (FoxO1), an antagonist for activated Stat3, specifically in β-cells ameliorated β-cell EMT and β-cell loss and prevented the onset of diabetes in mice undergoing PDL. Together, our data suggest that chronic pancreatitis may trigger TGFβ1-mediated β-cell EMT to lead to CPRD, which could substantially be prevented by sustained expression of FoxO1 in β-cells.