The present invention is directed toward peptide analogues of insulin B chain that are generally derived from peptides comprising residues 9 to 23 of the native B chain sequence. The analogues are altered from the native sequence at position 12, 13, 15 and/or 16, and may be additionally be altered at position 19 and/or other positions. Pharmaceutical compositions containing these peptide analogues are provided. The peptide analogues are useful for treating and inhibiting the development of diabetes.