Generating insulin-producing β-cells from human induced pluripotent stem cells is a promising cell replacement therapy for improving or curing insulin-dependent diabetes. However, current published protocols for targeted differentiation of human stem cells toward pancreatic b-cells fail to deliver sufficiently mature cells with functional properties comparable to human islet b-cells. Fundamental to the development of functional b-cells is an understanding of how stem cells or progenitor cells are instructed to become differentiated cells in the correct order. We hypothesize a role of environmental signals in combination with cell-to-cell signals such as Wnt-signaling can drive terminal differentiation, and achieving functional b-cell maturation.