Porcine epidemic diarrhea virus (PEDV) is an emerging and re-emerging viral pathogen of pigs that is causing significant economic concerns in the global pork industry. The virulent G2b PEDV subgroup, which was responsible for the 2013–2014 pandemics on the American and Asian continents, hit Jeju Island in 2014, which had been PEDV-free since 2004. This study presents molecular characterization of a novel PEDV variant with a 5-amino acid (aa) insertion (DTHPE) in the spike (S) gene (an S-insertion) that was identified in diarrheic piglets from Jeju Island. The genome of the PEDV strain KOR/KNU-1601/2016 was sequenced and analyzed to characterize the S-insertion variant circulating on Jeju Island. The full-length genome sequence of KNU-1601 is 28,053 nucleotides (nt) in length, which is 24 nt and 15 nt longer than the genome sequences of G1 classical and G2 epidemic field strains, respectively. KNU-1601 shares 99.5–99.6% nucleotide sequence identity at the genome level and 98.0–98.6% amino acid sequence identity at the S gene level with other global G2b PEDV strains. Genetic and phylogenetic analyses indicated that the KNU-1601 variant is most closely related to the G2b field isolates but appears to undergo continuous evolution in the field. These data advance our understanding of the genetic diversity and evolutionary characteristics of the PEDV field strains circulating in South Korea.