The development of insulin-producing pancreatic beta (β)-cells represents the culmination of a complex developmental program. Cells of the posterior foregut assume a pancreatic identity, cells within the expanding pancreatic primordia adopt an endocrine fate, and a subset of these precursors becomes competent to generate β-cells. Postnatally, β-cells are primarily maintained by self-duplication rather than new differentiation. Although major gaps in our knowledge still persist, experiments across several organisms have shed increasing light on the steps of β-cell specification and differentiation. Increasing our understanding of the extrinsic, as well as intrinsic, mechanisms that control these processes should facilitate efforts to regenerate this important cell type in humans.