Plays an important role in the differentiation and development of pancreatic islet beta cells. Transcriptional repressor that binds to a common element in the glucagon, insulin and somatostatin promoters. Competes with PAX6 for this same promoter binding site. Isoform 2 appears to be a dominant negative form antagonizing PAX4 transcriptional activity. Disease susceptibility is associated with variants affecting the gene represented in this entry. Disease susceptibility is associated with variants affecting the gene represented in this entry. Disease susceptibility is associated with variants affecting the gene represented in this entry. The disease is caused by variants affecting the gene represented in this entry. Belongs to the paired homeobox family. According to the human genome assembly there is a stop codon in position 349.