Diabetes is a complex, heterogeneous condition that has beta cell dysfunction at its core. Many factors (e.g. hyperglycemia/glucotoxicity, lipotoxicity, autoimmunity, inflammation, adipokines, islet amyloid, incretins and insulin resistance) influence the function of pancreatic beta cells. Chronic hyperglycaemia may result in detrimental effects on insulin synthesis/secretion, cell survival and insulin sensitivity through multiple mechanisms: gradual loss of insulin gene expression and other beta-cell specific genes; chronic endoplasmic reticulum stress and oxidative stress; changes in mitochondrial number, morphology and function; disruption in calcium homeostasis. In the presence of hyperglycaemia, prolonged exposure to increased free fatty acids result in accumulation of toxic metabolites in the cells (“lipotoxicity”), finally causing decreased insulin gene expression and impairment of insulin secretion. The rest of the factors/mechanisms which impact on the course of the disease are also discusses in detail.The correct assessment of beta cell function requires a concomitant quantification of insulin secretion and insulin sensitivity, because the two variables are closely interrelated. In order to better understand the fundamental pathogenetic mechanisms that contribute to disease development in a certain individual with diabetes, additional markers could be used, apart from those that evaluate beta cell function.The aim of the paper was to overview the relevant mechanisms/factors that influence beta cell function and to discuss the available methods of its assessment. In addition, clinical considerations are made regarding the therapeutical options that have potential protective effects on beta cell function/mass by targeting various underlying factors and mechanisms with a role in disease progression.