All pancreatic cell types (endocrine, exocrine, and ductal) are derived from the same endodermal dorsal and ventral anlage, which grow together to form the definitive pancreas. Golosow and Grobstein were pioneers in the field of pancreatic developmental research, as were Wessells and Cohen, who already in the 1960s performed classic embryological experiments describing the morphogenesis of the pancreas and the epithelio-mesenchymal interactions that are instrumental for proper pancreas development. Recent findings suggest that follistatin and fibroblast growth factors represent some of these key mesenchymal factors that actively promote at least pancreatic exocrine development. The true endodermal origin of the pancreatic endocrine cells became evident by experiments performed by the groups of LeDouarin and Rutter in the 1970s. The newly acquired insights regarding the specification of pancreatic endocrine cells as controlled by the notch signaling pathway (i.e., similar to the mechanisms by which neurons are specified during neurogenesis) have provided a novel understanding of the long acknowledged similarities between neurons and the pancreatic endocrine cells. Last, the identification of a number of distinct transcription factors operating at various levels of pancreatic development and in different cell types has provided useful information both on pancreas development and on various pancreatic disorders such as diabetes. Interestingly, four of the hitherto defined five different maturity-onset diabetes of the young (MODY) genes correspond to transcription factors, and, in addition, several transcription factors have also been linked to type 2 diabetes. Diabetes 50 (Suppl. 1): S5-S9, 2001 T he pancreas comprises endocrine, exocrine, and ductal cell types that collectively synthesize and secrete hormones and enzymes required for nutritional balance. Each of these distinct pancreatic cell types are derived from endodermal cells of the upper duodenal region of the foregut (1,2), and the development of the pancreas begins with the dorsal and ventral protrusion of a region of the primitive gut epithelium (3-5). The early steps that control the commitment of a region of localized gut epithelium to a pancreatic fate and the mechanism underlying the specification of the different pancreatic cell types are, however, not well understood. In addition, it remains unclear how the initially separate programs of dorsal and ventral pancreatic bud development are coordinated to produce a convergent developmental program.Several homeodomain and basic helix-loop-helix (bHLH) transcription factors, notably Isl1, Nkx2.2, Pax4, Pax6, and NeuroD/2, have been shown to exert important functions in the control of pancreatic endocrine cell differentiation (3-5). These factors are expressed at early stages of pancreas development, but in their absence, the initial steps of pancreatic development proceed normally, resulting only later in perturbation of the differentiation of pancreatic endocrine cell types (3-5). In contrast to the bH...