Insulin injections treat but do not cure Type 1 diabetes (T1DM). The success of islet transplantation suggests cell replacement therapies may offer a curative strategy. However, cadaver islets are of insufficient number for this to become a widespread treatment. To address this deficiency, the production of beta-cells from pluripotent stem cells offers an ambitious far-sighted opportunity. Recent progress in generating insulin-producing cells from embryonic stem cells has shown promise, highlighting the potential of trying to mimic normal developmental pathways. Here, we provide an overview of the current methodology that has been used to differentiate stem cells toward a beta-cell fate. Parallels are drawn with what is known about normal development, especially regarding the human pancreas.