In the pancreas, α- and β-cells possess a degree of plasticity. In vitro differentiation of pluripotent cells yields mostly α- and polyhormonal β-like cells, indicating a gap in understanding of how functional monohormonal β-cells are formed and of the endogenous repressive mechanisms used to maintain β-cell identity. We show that the corepressor Grg3 is expressed in almost all β-cells throughout embryogenesis to adulthood. However, Grg3 is expressed in fewer nascent α-cells and is progressively lost from α-cells as endocrine cells mature into adulthood. We show that mouse Grg3(+/-) β-cells have increased α-specific gene expression, and Grg3(+/-) pancreata have more α-cells and more polyhormonal cells, indicating that Grg3 is required for the physiologic maintenance of monohormonal β-cell identity. Ectopic expression of Grg3 in α-cells represses glucagon and Arx, and the addition of Pdx1 induces Glut2 expression and glucose-responsive insulin secretion. Furthermore, we found that Grg1 is the predominant Groucho expressed in human β-cells but acts functionally similarly to Grg3. Overall, we find that Grg3 and Grg1 establish a monohormonal β-cell identity, and Groucho family members may be useful tools or markers for making functional β-cells.