Type 1 diabetes, along with its long-term complications, imposes a serious impact on public health. In spite of the development and application of various insulin formulations, exogenous insulin neither achieves the same degree of glycemic control as that provided by endogenous insulin, nor prevents the long-term complications associated with type 1 diabetes. As an alternative strategy, insulin gene transfer is being explored to restore endogenous insulin production in type 1 diabetes. Sustained hepatic insulin production has been shown to reverse ketonuria, prevent ketoacidosis, improve body weight gain and significantly ameliorate the adverse effects of insulin deficiency in diabetic animals. However, to achieve adequately regulated insulin production in response to changes in blood glucose concentrations remains a major hurdle. This article will review the most recent advances made to address this crucial limitation. In addition, based on the significance of maintaining basal plasma insulin for management of type 1 diabetes, we discuss the feasibility of developing basal hepatic insulin production as an auxiliary treatment to current insulin therapy for achieving tight glycemic control in type 1 diabetes.