Pharmacological inhibition of the dipeptidyl peptidase-4 (DPP4) enzyme potentiates incretin action and is widely used to treat type 2 diabetes. Nevertheless, the precise cells and tissues critical for incretin degradation and glucose homeostasis remain unknown. Here, we use mouse genetics and pharmacologic DPP4 inhibition to identify DPP4+ cell types essential for incretin action. Although enterocyte DPP4 accounted for substantial intestinal DPP4 activity, ablation of enterocyte DPP4 in Dpp4Gut-/- mice did not produce alterations in plasma DPP4 activity, incretin hormone levels, and glucose tolerance. In contrast, endothelial cell (EC)-derived DPP4 contributed substantially to levels of soluble plasma DPP4 activity, incretin degradation, and glucose control. Surprisingly, DPP4+ cells of bone marrow origin mediated the selective degradation of fasting GIP, but not GLP-1. Collectively, these findings identify distinct roles for DPP4 in the EC versus the bone marrow compartment for selective incretin degradation and DPP4i-mediated glucoregulation.