The ability of embryonal carcinoma )EC (stem cells to generate insulin-producing cells (IPCs) is still unknown. We examined the trophic effects of pancreas-conditioned medium (PCM) on in vitro production of IPCs. Initially, P19 EC cells were characterized by the expression of stem cell markers, Oct3/4, Sox-2 and Nanog. To direct differentiation, P19-derived embryoid bodies (EBs) were induced by selection of nestin-positive cells and treatment with different concentrations of PCM. Morphological studies documented the presence of islet-like cell IPCs clusters. The differentiated cells were immunoreactive for β cell-specific proteins, including insulin, proinsulin, C-peptide and insulin receptor-β. The expression of genes related to pancreatic β cell development and function (PDX-1, INS1, INS2, EP300 and CREB1) was confirmed by qPCR. During differentiation, the expression of EP300 and CREB1 increased by 2.5 and 3.1 times, respectively. In contrast, a sharp decrease in the expression of Oct3/4, Sox-2 and Nanog by 4, 1.5 and 1.5 times, respectively, was observed. The differentiated cells were functionally active, synthesizing and secreting insulin in a glucose-regulated manner. Network prediction highlighted crosstalk between PDX-1 transcription factor and INS2 ligand in IPC generation and revealed positive regulatory effects of EP300, CREB1, PPARA, EGR, KIT, GLP1R, and PKT2 on activation of PDX-1 and INS2. This is the first report of the induction of IPC differentiation from EC cells by using neonate mouse PCM. Since P19 EC cells are widely available, easily cultured without feeders and do not require special growth conditions, they would provide a valuable tool for studying pancreatic β cell differentiation and development. Copyright © 2016 John Wiley & Sons, Ltd.