Pancreatic endocrine cell differentiation depends on transcription factors that also contribute in adult insulin and glucagon gene expression. Islet cell development was examined in mice lacking MafB, a transcription factor expressed in immature alpha (glucagon(+)) and beta (insulin(+)) cells and capable of activating insulin and glucagon expression in vitro. We observed that MafB(-/-) embryos had reduced numbers of insulin(+) and glucagon(+) cells throughout development, whereas the total number of endocrine cells was unchanged. Moreover, production of insulin(+) cells was delayed until embryonic day (E) 13.5 in mutant mice and coincided with the onset of MafA expression, a MafB-related activator of insulin transcription. MafA expression was only detected in the insulin(+) cell population in MafB mutants, whereas many important regulatory proteins continued to be expressed in insulin(-) beta cells. However, Pdx1, Nkx6.1, and GLUT2 were selectively lost in these insulin-deficient cells between E15.5 and E18.5. MafB appears to directly regulate transcription of these genes, because binding was observed within endogenous control region sequences. These results demonstrate that MafB plays a previously uncharacterized role by regulating transcription of key factors during development that are required for the production of mature alpha and beta cells.