Replacement of lost beta cells in patients with diabetes has the potential to alleviate them of their disease, yet current protocols to make beta cells are inadequate for therapy. In vitro screens can reveal the signals necessary for endocrine maturation to improve beta cell production, however the complexities of in vivo development that lead to beta cell formation are lost in two-dimensional systems. Here, we create three-dimensional organotypic pancreatic cultures, named pancreatoids, composed of embryonic day 10.5 murine epithelial progenitors and native mesenchyme. These progenitors assemble in scaffold-free, floating conditions and, with the inclusion of native mesenchyme, develop into pancreatoids expressing markers of different pancreatic lineages including endocrine-like cells. Treatment of pancreatoids with (-)-Indolactam-V or phorbol 12-myristate 13-acetate, two protein kinase C activators, leads to altered morphology which otherwise would be overlooked in two-dimensional systems. Protein kinase C activation also led to fewer Insulin+ cells, decreased Ins1 and Ins2 mRNA levels, and increased Pdx1 and Hes1 mRNA levels with a high number of DBA+ cells. Thus, organotypic pancreatoids provide a useful tool for developmental studies, and can further be used for disease modeling, small molecules and genetic screens, or applied to human pluripotent stem cell differentiation for beta-like cell formation.