In both type 1 and type 2 diabetes, insufficient numbers of insulin-producing β cells are a major cause of defective control of blood glucose and its complications. Accordingly, therapies that increase functional β-cell mass may offer a cure for diabetes. Efforts to achieve this goal explore several directions. Based on the realization that β cells are capable of significant proliferation throughout adult life, the enhanced proliferation of β cells in vivo or in vitro is pursued as a strategy for regenerative medicine for diabetes. Alternatively, the conversion of differentiated cells such as hepatocytes into β cells is being attempted using molecular insights into the transcriptional makeup of β cells. Advances were also made in directing the differentiation of embryonic stem cells into β cells. Although progress is encouraging, major gaps in our understanding of developmental biology of the pancreas and adult β-cell dynamics remain to be closed before a therapeutic application is made possible.