Islet neogenesis, or the differentiation of islet cells from precursor cells, is seen in vitro and in vivo both embryonically and after birth. However, little is known about the differentiation pathways during embryonic development for human pancreas. Our previously reported in vitro generation of islets from human pancreatic tissue provides a unique system to identify potential markers of neogenesis and to determine the molecular mechanisms underlying this process. To this end, we analyzed the gene expression profiles of three different stages during in vitro islet generation: the Initially Adherent, Expanded, and Differentiated stages. Samples from four human pancreases were hybridized to Affymetrix U95A GeneChips, and data analyzed using GeneSpring 7.0/9.0 software. Using scatter plots we selected genes with a 2-fold or greater differential expression. Of the 12,000 genes/ESTs present on these arrays, 295 genes including 38 acinar-enriched genes were selectively lost during the progression from the Initially Adherent stage to the Expanded stage; 468 genes were increased in this progression to Expanded tissue; and 529 genes had a two-fold greater expression in the Differentiated stage than in the Expanded tissue. Besides the expected increases in insulin, glucagon, and duct markers (mucin 6, aquaporin 1 and 5), the beta cell auto-antigen IA-2/phogrin was increased 5-fold in Differentiated. In addition, developmentally important pathways, including notch/jagged, Wnt/frizzled, TGFbeta superfamily (follistatin, BMPs, and SMADs), and retinoic acid (COUP-TFI, CRABP1, 2, and RAIG1) were differentially regulated during the expansion/differentiation. Two putative markers for islet precursor cells, UCHL1/PGP9.5 and DMBT1, were enhanced during the progression to differentiated cells, but only the latter could be a marker of islet precursor cells. We suggest that appropriate manipulation of these differentiation-associated pathways will enhance the efficiency of differentiation of insulin-producing beta-cells in this in vitro model.