NMDA receptors (NMDARs) are Ca-permeant, ligand-gated ion channels activated by the excitatory neurotransmitter glutamate and have well-characterized roles in the nervous system. The expression and function of NMDARs in pancreatic β-cells, by contrast, are poorly understood. Here, we report a novel function of NMDARs in β-cells. Using a combination of biochemistry, electrophysiology, and imaging techniques, we now show that NMDARs have a key role in mediating the effect of leptin to modulate β-cell electrical activity by promoting AMP-activated protein kinase (AMPK)-dependent trafficking of K and Kv2.1 channels to the plasma membrane. Blocking NMDAR activity inhibited the ability of leptin to activate AMPK, induce K and Kv2.1 channel trafficking, and promote membrane hyperpolarization. Conversely, activation of NMDARs mimicked the effect of leptin, causing Ca influx, AMPK activation, and increased trafficking of K and Kv2.1 channels to the plasma membrane, and triggered membrane hyperpolarization. Moreover, leptin potentiated NMDAR currents and triggered NMDAR-dependent Ca influx. Importantly, NMDAR-mediated signaling was observed in rat insulinoma 832/13 cells and in human β-cells, indicating that this pathway is conserved across species. The ability of NMDARs to regulate potassium channel surface expression and thus, β-cell excitability provides mechanistic insight into the recently reported insulinotropic effects of NMDAR antagonists and therefore highlights the therapeutic potential of these drugs in managing type 2 diabetes.