Islets in humans with Type 2 diabetes, and the brain in neurodegenerative disease, exhibit many common features, including: protein misfolding of amyloidogenic proteins, inflammation, activation of vascular endothelium and dedifferentiation. Islet amyloid polypeptide, encoded by the gene IAPP in humans, is the most aggregate-prone and toxic of known amyloidogenic proteins. To address the question, does IAPP misfolding-induced stress initiate the wide ranging changes in islets in T2D, we compared the transcriptome of islets of human IAPP transgenic mice before diabetes onset with islets from humans with T2D. Beta cell IAPP toxicity reproduces the transcriptome in T2D islets with prominent activation of inflammation and vascular endothelium, and beta cell dedifferentiation. In common with T2D and neurodegenerative diseases, these changes were mediated through activation of key injury response transcription factors NF-kB, STAT3, CTNNB1 and ESR1. We conclude that suppression of IAPP expression is a potentially disease modifying therapeutic intervention in T2D.