Type 1 (insulin-dependent) diabetes is one of the most costly chronic diseases of children and adolescents in North America and Europe. It occurs in genetically predisposed individuals when the immune system attacks and destroys specifically the insulin-producing beta cells of the pancreatic islets of Langerhans. Although routine insulin injections can provide diabetic patients their daily insulin requirements, non-compliance commonly results in blood glucose excursions that eventually lead to microvascular and macrovascular complications and early death. The only real 'cure' for type 1 diabetes is replacement of the beta-cell mass which, today, is either an ectopancreatic transplant or an islet of Langerhans implant. Two new developments may offer additional options: surrogate, non-endocrine cells genetically modified to secrete insulin in response to high blood glucose levels; and stem cells that possess the capacity to differentiate to endocrine pancreas. In this short review, we discuss the efforts currently being made to regulate pancreatic stem cell growth in order to produce large numbers of functional islets that can be used as implants. Hopefully, autologous stem cell-derived islet cell implants without lifelong immunosuppressive therapy may one day be realized.