Human embryonic stem cells (hESCs) and induced pluripotent cells (iPSCs) have the potential to differentiate into any somatic cell, making them ideal candidates for cell replacement therapies to treat a number of human diseases and regenerate damaged or non-functional tissues and organs. Key to the promise of regenerative medicine is developing standardized protocols that can safely be applied in patients. Progress towards this goal has occurred in a number of fields, including type 1 diabetes mellitus (T1D). During the past 10 years, significant technological advances in hESC/iPSC biochemistry have provided a roadmap to generate sufficient quantities of glucose-responsive, insulin-producing cells capable of eliminating diabetes in rodents. Although many of the molecular mechanisms underlying the genesis of these cells remain to be elucidated, the field of cell-based therapeutics to treat T1D has advanced to the point where the first Phase I/II trials in humans have begun. Here, we provide a concise review of the history of cell replacement therapies to treat T1D from islet transplantations and xenotranplantation, to current work in hESC/iPSC. We also highlight the latest advances in efforts to employ insulin-producing, glucose-responsive β-like cells derived from hESC as therapeutics.