Recently, significant advances have been made in the number and purity of islets that can be retrieved from the human pancreas, thus enabling several centers to initiate or resume clinical trials of islet transplantation in type I diabetic patients. Although the success rate of islet transplantation is lower than that of pancreas transplantation in terms of achievement of insulin-independence, islet transplantation has significant potential advantages over vascularized pancreas transplantation: it is a simple and safe procedure; it has the potential to be performed on an outpatient basis; it offers access to cell banking after cryopreservation; it offers the potential advantages of pre-transplant reduction of immunogenicity; and it even offers the future feasibility of xenotransplantation. In this article, the current status of clinical trials and future perspectives of islet transplantation, including immunomodulation, immunotolerance, immunoisolation, and xenotransplantation, are reviewed.