Two mouse insulin genes, Ins1 and Ins2, were disrupted and lacZ was inserted at the Ins2 locus by gene targeting. Double nullizygous insulin-deficient pups were growth-retarded. They did not show any glycosuria at birth but soon after suckling developed diabetes mellitus with ketoacidosis and liver steatosis and died within 48 h. Interestingly, insulin deficiency did not preclude pancreas organogenesis and the appearance of the various cell types of the endocrine pancreas. The presence of lacZ expressing  cells and glucagon-positive ␣ cells was demonstrated by cytochemistry and immunocytochemistry. Reverse transcriptioncoupled PCR analysis showed that somatostatin and pancreatic polypeptide mRNAs were present, although at reduced levels, accounting for the presence also of ␦ and pancreatic polypeptide cells, respectively. Morphometric analysis revealed enlarged islets of Langherans in the pancreas from insulin-deficient pups, suggesting that insulin might function as a negative regulator of islet cell growth. Whether insulin controls the growth of specific islet cell types and the molecular basis for this action remain to be elucidated.Insulin is synthesized, stored, and secreted by the pancreatic islet  cells in a highly regulated manner and plays a vital role in glucose homeostasis. Insulin action also results in several other pleiotropic effects that are less well documented. Embryonic insulin synthesis begins early in gestation, but fetal glycemia closely follows maternal blood glucose levels. The question, therefore, arises as to what function embryonic insulin might fulfill during development. For instance, one might ask whether insulin plays an autocrine or paracrine role in pancreatic islet cell growth and differentiation, since insulin is synthesized with other hormones in developing islet cell types (1-3). Recently, this question has been addressed in a few transgenic studies. For instance, the gene encoding PDX-1 (4, 5), a homeodomain transcription factor synthesized in adult  cells and capable of transactivating insulin gene expression, has been inactivated by targeted disruption (6, 7). Agenesis of pancreas resulting from PDX-1 deficiency precluded from addressing the question of the possible role of insulin in islet cell growth and differentiation. Similarly, mice lacking the LIM homeodomain transcription factor ISL1, synthesized in all classes of islet cells in the adult, were arrested in development soon after embryonic day 9.5 (8). The requirement of ISL1 in pancreatic epithelium for the differentiation of all islet cell types was, however, demonstrated by in vitro culture of explants from ISL1-deficient embryonic day 9.5 embryos that gave rise to cells that were negative for glucagon, insulin, and somatostatin. In another study, transgenic mouse embryos expressing the gene encoding the diphteria toxin A chain under control of the rat Ins2 promoter were generated (9). The resulting genetic ablation of the insulin-producing cells did not appear to alter the development of the nontarget...