Exogenous insulin is, at the moment, the therapy of choice of diabetes, but does not allow tight regulation of glucose leading to long-term complications. Recently, pancreatic islet transplantation to reconstitute insulin-producing β cells, has emerged as an alternative promising therapeutic approach. Unfortunately, the number of donor islets is too low compared with the high number of patients needing a transplantation leading to a search for renewable sources of high-quality β-cells. This review, summarizes more recent promising approaches to the generation of new β-cells from embryonic stem cells for transdifferentiation of adult cells, particularly a critical examination of the seminal work by Lumelsky et al.