Previous work has demonstrated that the peptide hormone ghrelin raises blood glucose. Such has been attributed to ghrelin's ability to enhance GH secretion, restrict insulin release, and/or reduce insulin sensitivity. Ghrelin's reported effects on glucagon have been inconsistent. Here, both animal- and cell-based systems were used to determine the role of glucagon in mediating ghrelin's effects on blood glucose. The tissue and cell distribution of ghrelin receptors (GHSR) was evaluated by quantitative PCR and histochemistry. Plasma glucagon levels were determined following acute acyl-ghrelin injections and in pharmacological and/or transgenic mouse models of ghrelin overexpression and GHSR deletion. Isolated mouse islets and the α-cell lines αTC1 and InR1G9 were used to evaluate ghrelin's effects on glucagon secretion and the role of calcium and ERK in this activity. GHSR mRNA was abundantly expressed in mouse islets and colocalized with glucagon in α-cells. Elevation of acyl-ghrelin acutely (after sc administration, such that physiologically relevant plasma ghrelin levels were achieved) and chronically (by slow-releasing osmotic pumps and as observed in transgenic mice harboring ghrelinomas) led to higher plasma glucagon and increased blood glucose. Conversely, genetic GHSR deletion was associated with lower plasma glucagon and reduced fasting blood glucose. Acyl-ghrelin increased glucagon secretion in a dose-dependent manner from mouse islets and α-cell lines, in a manner requiring elevation of intracellular calcium and phosphorylation of ERK. Our study shows that ghrelin's regulation of blood glucose involves direct stimulation of glucagon secretion from α-cells and introduces the ghrelin-glucagon axis as an important mechanism controlling glycemia under fasting conditions.