RFX3 in human pancreatic islet development has not been explored. This study aims to investigate the function of RFX3 in human pancreatic islet development using human islet organoids derived from iPSCs, hypothesizing that RFX3 regulates human islet cell differentiation. We generated RFX3 knockout (RFX3 KO) iPSC lines using CRISPR/Cas9 and differentiated them into pancreatic islet organoids. Various techniques were employed to assess gene expression, cell markers, apoptosis, proliferation, and glucose-stimulated insulin secretion. Single-cell RNA sequencing (scRNA-seq) datasets from hESC-derived pancreatic islets were re-analyzed to investigate RFX3 expression in specific cell populations at various developmental stages. Furthermore, bulk RNA sequencing was conducted to further assess transcriptomic changes. RFX3 was found to be highly expressed in pancreatic endocrine cell populations within pancreatic progenitors (PPs), endocrine progenitors (EPs), and mature islet stages derived from iPSCs. scRNA-seq further confirmed RFX3 expression across different endocrine cell clusters during differentiation. RFX3 loss disrupted pancreatic endocrine gene regulation, reduced hormone-secreting islet cells, and impaired beta-cell function and insulin secretion. Despite a significant reduction in pancreatic islet hormones, the pan-endocrine marker CHGA remained unchanged at both EP and islet stages, likely due to an increase in enterochromaffin cells (ECs). This was supported by our findings of high EC marker expression in RFX3 KO EPs and islets. In addition, RFX3 loss led to smaller islet organoids, elevated TXNIP levels, and increased apoptosis in EPs and islets. These findings underscore the crucial role of RFX3 in regulating human islet cell differentiation and its role in suppressing enterochromaffin cell specification. These insights into RFX3 function have implications for understanding islet biology and potential diabetes susceptibility.