Exenatide (synthetic exendin-4), glucagon-like peptide-1 (GLP-1), and GLP-1 analogues have actions with the potential to significantly improve glycemic control in patients with diabetes. Evidence suggests that these agents use a combination of mechanisms which may include glucose-dependent stimulation of insulin secretion, suppression of glucagon secretion, enhancement of beta-cell mass, slowing of gastric emptying, inhibition of food intake, and modulation of glucose trafficking in peripheral tissues. The short in vivo half-life of GLP-1 has proven a significant barrier to continued clinical development, and the focus of current clinical studies has shifted to agents with longer and more potent in vivo activity. This review examines recent exendin-4 pharmacology in the context of several known mechanisms of action, and contrasts exendin-4 actions with those of GLP-1 and a GLP-1 analogue. One of the most provocative areas of recent research is the finding that exendin-4 enhances beta-cell mass, thereby impeding or even reversing disease progression. Therefore, a major focus of this is article an examination of the data supporting the concept that exendin-4 and GLP-1 may increase beta-cell mass via stimulation of beta-cell neogenesis, stimulation of beta-cell proliferation, and suppression of beta-cell apoptosis.