Stem cell–derived islet replacement therapies for diabetes: current progress and translational challenges

Diabetes mellitus is a chronic metabolic disorder characterized by impaired glucose homeostasis resulting from insufficient insulin production, defective insulin action, or both. Despite major advances in pharmacological management, current treatments fail to fully restore physiological glycemic control and are associated with significant long-term complications. The clinical success of the Edmonton Protocol established islet transplantation as a life-changing therapy for Type 1 diabetes. However, its widespread application remains hindered by a critical shortage of donor organs and the requirement for lifelong immunosuppression. Human pluripotent stem cells offer a virtually inexhaustible alternative for generating functional, insulin-producing cells and islet-like clusters. While significant strides have been made in recapitulating pancreatic organogenesis in vitro, considerable challenges remain, including the safety concerns related to residual undifferentiated or contaminating non-target cell populations, and the threat of immune rejection. In this review, we examine the current state of stem cell-derived islet replacement therapies, with a focus on improving differentiation efficiency, understanding the functional role of endocrine cell heterogeneity, and overcoming immune and inflammatory barriers. We discuss emerging strategies such as encapsulation technologies, local immunomodulation, and genetic engineering approaches to enhance graft survival and function. Finally, we provide a comparative analysis of embryonic stem cell versus induced pluripotent stem cell sources and summarize the landscape of ongoing stem cell-based transplantations for diabetes treatment in clinical trials.