The pancreas is an essential endoderm-derived organ that ensures nutrient metabolism via its endocrine and exocrine functions. Here we review the essential processes governing the embryonic and early postnatal development of the pancreas discussing both the mechanisms and molecules controlling progenitor specification, expansion and differentiation. We elaborate on how these processes are orchestrated in space and coordinated with morphogenesis. We draw mainly from experiments conducted in the mouse model but also from investigations in other model organisms, complementing a recent comprehensive review of human pancreas development (Jennings et al., 2015) [1]. The understanding of pancreas development in model organisms provides a framework to interpret how human mutations lead to neonatal diabetes and may contribute to other forms of diabetes and to guide the production of desired pancreatic cell types from pluripotent stem cells for therapeutic purposes.