Understanding in detail how pancreatic endocrine cells develop is important for many reasons. From a scientific point of view, elucidation of such a complex process is a major challenge. From a more applied point of view, this may help us to better understand and treat specific forms of diabetes. Although a variety of therapeutic approaches are well validated, no cure for diabetes is available. Many arguments indicate that the development of new strategies to cure diabetic patients will require precise understanding of the way beta-cells form during development. This is obvious for a future cell therapy using beta-cells produced from embryonic stem cells. This also holds true for therapeutic approaches based on regenerative medicine. In this review, we summarize our current knowledge concerning pancreatic development and focus on the role of extracellular signals implicated in beta-cell development from pancreatic progenitors.