Pancreatic duodenal homeobox -1 is a transcription factor that is expressed in beta and delta cells of the islets of Langerhans and in dispersed endocrine cells of the duodenum. It is involved in regulating the expression of a number of key beta-cell genes as well as somatostatin. It also plays a pivotal part in the development of the pancreas and islet cell ontogeny. Thus homozygous disruption of the gene in mice and humans results in pancreatic agenesis. Heterozygous mutations in the gene result in impaired glucose tolerance and symptoms of diabetes as seen in MODY4 and late-onset Type II (non-insulin-dependent) diabetes mellitus. In adults pancreatic duodenal homeobox-1 expression is increased in duct cells of the pancreas that have been induced to proliferate and differentiate to form new islets. Defects in pancreatic duodenal homeobox-1 could therefore contribute to Type II diabetes by affecting compensatory mechanisms that increase the rate of beta-cell neogenesis to meet the increased insulin secretory demand. It could also be a pharmacological target for beta-cell defects in Type II diabetes, while its role as a regulator of islet stem cell activity is being exploited to produce a replenishable source of islet tissue for transplantation in Type I (insulin-dependent) diabetes mellitus.