This study investigates the role of the BETA2/NeuroD transcription factor in pancreatic development, particularly in the differentiation of pancreatic endocrine cells. Mice lacking a functional BETA2 gene were generated through gene targeting experiments. These mice exhibited severe diabetes and died perinatally due to a reduction in the number of insulin-producing β cells and the failure to develop mature islets. The absence of BETA2 also led to the failure of secretin- and cholecystokinin-producing enteroendocrine cells to develop, which may explain the abnormal cellular polarity and inability to secrete zymogen granules in pancreatic acinar exocrine cells. Despite the presence of BETA2 in the developing nervous system, the brains of these mutant mice showed no apparent neuronal defects. The results suggest that BETA2 is critical for the normal development of several specialized cell types arising from the gut endoderm, including pancreatic endocrine cells and enteroendocrine cells.This study investigates the role of the BETA2/NeuroD transcription factor in pancreatic development, particularly in the differentiation of pancreatic endocrine cells. Mice lacking a functional BETA2 gene were generated through gene targeting experiments. These mice exhibited severe diabetes and died perinatally due to a reduction in the number of insulin-producing β cells and the failure to develop mature islets. The absence of BETA2 also led to the failure of secretin- and cholecystokinin-producing enteroendocrine cells to develop, which may explain the abnormal cellular polarity and inability to secrete zymogen granules in pancreatic acinar exocrine cells. Despite the presence of BETA2 in the developing nervous system, the brains of these mutant mice showed no apparent neuronal defects. The results suggest that BETA2 is critical for the normal development of several specialized cell types arising from the gut endoderm, including pancreatic endocrine cells and enteroendocrine cells.