The understanding of the molecular biology of the pancreas β‐cell began 25 years ago with the cloning of the insulin cDNA, followed by the determination of the genomic organization and the identification of multiple
cis
‐ and
trans
‐acting elements in the 5′‐flanking region. The developmental biology of the pancreas started earlier but was put on hold until the molecular biological technology allowed approaching the questions raised some 30 years ago. A major breakthrough happened 8 years ago when disruption of the gene for an insulin gene transcription factor was found to ablate the development of the pancreas. This has greatly stimulated the search for new transcription factors and their regulation by growth and differentiation factors in order to understand the basal molecular mechanisms involved in the formation of the pancreas β‐cell and the perspectives for prevention, treatment, and cure of diabetes. The maintenance of an appropriate β‐cell mass depends on neogenesis from progenitor cells, proliferation of existing β‐cells, and β‐cell death. The balance between these processes is regulated by a complex interaction of metabolites, hormones, and growth factors. Under normal conditions there appears to be a close correspondence between insulin demand and the functional β‐cell mass. The function of the β‐cell is not only under acute regulation by nutrients following a meal but is also subject to regulation by chronic changes in the insulin demand as in pregnancy or obesity, which result in adjustment of the β‐cell number.