Recent studies have suggested that the zebrafish pancreas develops from a single pancreatic anlage, located on the dorsal aspect of the developing gut. However, using a transgenic zebrafish line that expresses GFP throughout the endoderm, we report that, in fact, two pancreatic anlagen join to form the pancreas. One anlage is located on the dorsal aspect of the developing gut and is present by 24 h postfertilization (hpf), the second anlage is located on the ventral aspect of the developing gut in a position anterior to the dorsal anlage and is present by 40 hpf. These two buds merge by 52 hpf to form the pancreas. Using heart and soul mutant embryos, in which the pancreatic anlagen most often do not fuse, we show that the posterior bud generates only endocrine tissue, while the anterior bud gives rise to the pancreatic duct and exocrine cells. Interestingly, at later stages, the anterior bud also gives rise to a small number of endocrine cells usually present near the pancreatic duct. Altogether, these studies show that in zebrafish, as in the other model systems analyzed to date, the pancreas arises from multiple buds. To analyze whether other features of pancreas development are conserved and investigate the influence of surrounding tissues on pancreas development, we examined the role of the vasculature in this process. Contrary to reports in other model systems, we find that, although vascular endothelium is in contact with the posterior bud throughout pancreas development, its absence in cloche mutant embryos does not appear to affect the early morphogenesis or differentiation of the pancreas.