Diabetes mellitus is one of the leading causes of death worldwide. Loss and functional failure of pancreatic β-cells, the parenchyma cells in the islets of Langerhans, progress diabetes mellitus. The increasing incidence of this metabolic disorder necessitates efficient strategies to produce functional β-cells for treating diabetes mellitus. Human induced Pluripotent Stem Cells (hiPSC), hold potential for treating diabetes ownig to their self-renewal capacity and the ability to differentiate into β- cells. iPSC technology also provides unlimited starting material to generate differentiated cells for regenerative applications. Progress has also been made in establishing in-vitro culture protocols to yield definitive endoderm, pancreatic endoderm progenitor cells and β-cells via different reprogramming strategies and growth factor supplementation. However, these generated β-cells are still immature, lack functional characteristics and exhibit lower capability in reversing the diseases conditions. Current methods employed to generate mature and functional β-cells include; use of small and large molecules to enhance the reprogramming and differentiation efficiency, 3D culture systems to improve the functional properties and heterogeneity of differentiated cells. This review details recent advancements in the generation of mature β-cells by reprogramming stem cells into iPSCs that are further programmed to β-cells. It also provides deeper insight into current reprogramming protocols and their efficacy, focusing on the underlying mechanism of chemical-based approach to generate iPSCs. Furthermore, we have highlighted the recent differentiation strategies both in-vitro and in-vivo to date and the future prospects in the generation of mature β-cells.