We previously reported that new beta cells differentiated in pancreatic islets of mice in which diabetes was produced by injection of a high dose of the beta cell toxin streptozotocin (SZ), which produces hyperglycemia due to rapid and massive beta cell death. After SZ-mediated elimination of existing beta cells, a population of insulin containing cells reappeared in islets. However, the number of new beta cells was small, and the animals remained severely hyperglycemic. In the present study, we tested whether restoration of normoglycemia by exogenous administered insulin would enhance beta cell differentiation and maturation. We found that beta cell regeneration improved in SZ-treated mice animals that rapidly attained normoglycemia following insulin administration because the number of beta cells per islet reached near 40% of control values during the first week after restoration of normoglycemia. Two presumptive precursor cell types appeared in regenerating islets. One expressed the glucose transporter-2 (Glut-2), and the other cell type coexpressed insulin and somatostatin. These cells probably generated the monospecific cells containing insulin that repopulated the islets. We conclude that beta cell neogenesis occurred in adult islets and that the outcome of this process was regulated by the insulin-mediated normalization of circulating blood glucose levels.