In this review, we focus on the processes guiding human pancreas development and provide an update on methods to efficiently generate pancreatic progenitors (PPs) and β-like cells in vitro from human pluripotent stem cells (hPSCs). Furthermore, we assess the strengths and weaknesses of using PPs and β-like cell for cell replacement therapy for the treatment of Type 1 diabetes with respect to cell manufacturing, engrafting, functionality, and safety. Finally, we discuss the identification and use of specific cell surface markers to generate safer populations of PPs for clinical translation and to study the development of PPs in vivo and in vitro.