Insulin-expressing beta cells, found in pancreatic islets, are capable of generating more beta cells even in the adult. We show that fibroblast-like cells derived from adult human islets donated postmortem proliferate readily in vitro. These mesenchymal-type cells, which exhibit no hormone expression, can then be induced to differentiate into hormone-expressing islet-like cell aggregates, which reestablishes the epithelial character typical of islet cells. Immunohistochemistry, in situ hybridization, and messenger RNA measurements in single cells and cell populations establish the transition of epithelial cells within islets to mesenchymal cells in culture and then to insulin-expressing epithelial cells.