To investigate the effects of 2-(4-methoxycarbonyl-2-tetradecyloxyphenyl)carbamoylbenzoic acid (CX09040) on protecting pancreatic β cells, the β cell dysfunction model mice were induced by injection of alloxan into the caudal vein of ICR mice, and were treated with compound CX09040. Liraglutide was used as the positive control drug. The amount and the size of islets observed in pathological sections were calculated to evaluate the β cell mass; the glucose stimulated insulin secretion (GSIS) test was applied to estimate the β cell secretary function; the oral glucose tolerance test (OGTT) was taken to observe the glucose metabolism in mice; the expressions of protein in pancreas were detected by Western blotting. The effects on the target protein tyrosine phosphatase 1B (PTP1B) were assessed by the PTP1B activities of both recombinant protein and the intracellular enzyme, and by the PTP1B expression in the pancreas of mice, separately. As the results, with the treatment of CX09040 in alloxan-induced β cell dysfunction mice, the islet amount (P<0.05) and size (P<0.05) increased significantly, the changes of serum insulin in GSIS (P<0.01) and the values of acute insulin response (AIR, P<0.01) were enhanced, compared to those in model group; the impaired glucose tolerance was also ameliorated by CX09040 with the decrease of the values of area under curve (AUC, P<0.01). The activation of the signaling pathways related to β cell proliferation was enhanced by increasing the levels of p-Akt/Akt (P<0.01), p-FoxO1/FoxOl (P<0.001) and PDX-1 (P<0.01). The effects of CX09040 on PTP1B were observed by inhibiting the recombinant hPTP1B activity with IC50 value of 2.78x 10(-7) mol.L-1, reducing the intracellular PTP1B activity of 72.8% (P<0.001), suppressing the PTP1B expression (P<0.001) and up-regulating p-IRβ/IRβ (P<0.01) in pancreas of the β cell dysfunction mice, separately. In conclusion, compound CX09040 showed significant protection effects against the dysfunction of β cell of mice by enlarging the pancreatic β cell mass and increasing the glucose-induced insulin secretion; its major mechanism may be the inhibition on target PTP1B and the succedent up-regulation of β cell proliferation.