Bile acids are signalling molecules, which activate the transmembrane receptor TGR5 and the nuclear receptor FXR. BA sequestrants (BAS) complex bile acids in the intestinal lumen and decrease intestinal FXR activity. The BAS-BA complex also induces glucagon-like peptide-1 (GLP-1) production by L cells which potentiates beta-cell glucose-induced insulin secretion. Whether FXR is expressed in L cells and controls GLP-1 production is unknown. Here, we show that FXR activation in L cells decreases proglucagon expression by interfering with the glucose-responsive factor Carbohydrate-Responsive Element Binding Protein (ChREBP) and GLP-1 secretion by inhibiting glycolysis. In vivo, FXR deficiency increases GLP-1 gene expression and secretion in response to glucose hence improving glucose metabolism. Moreover, treatment of ob/ob mice with the BAS colesevelam increases intestinal proglucagon gene expression and improves glycaemia in a FXR-dependent manner. These findings identify the FXR/GLP-1 pathway as a new mechanism of BA control of glucose metabolism and a pharmacological target for type 2 diabetes.