A feedback loop exists between the digestive and olfactory systems; metabolic state regulates olfactory sensitivity, while depressed olfactory sensitivity decreases food intake and improves metabolic health. How metabolic state alters odour processing and how this is linked to altered perception and feeding behaviour is poorly understood. Insulin is a key metabolic signal with the highest density of receptors found in the olfactory bulb and insulin applied exogenously to the olfactory bulb suppresses olfactory sensitivity. We have been exploring how insulin regulates the olfactory bulb circuitry using a combination of patch-clamp electrophysiology, 2-photon calcium imaging, immunohistochemistry, and behavioural tests. We began by focusing on how the first synapse in the olfactory system is modulated by insulin. Periglomerular neurons provide the first layer of inhibition in the olfactory bulb, surrounding the glomeruli where the olfactory nerve terminates. We find that a subset of these periglomerular neurons express insulin receptors, which inhibit a voltage-gated potassium current normally active at resting membrane potentials. Using 2-photon imaging we show that insulin reduces evoked Ca²⁺ transients in olfactory nerve terminals which was dependent on feedback inhibition from periglomerular neurons. In vivo, imaging shows that the sensitivity of periglomerular neurons to odours is increased by satiety whereas the olfactory nerve input is reduced. Periglomerular neurons seem to play a key role in the state-dependent modulation of olfactory transmission from the nose to the brain.