We describe the cloning of insulin promoter factor 1 (IPF1), a homeodomain protein which in the adult mouse pancreas is selectively expressed in the beta‐cells and which binds to and transactivates the insulin promoter. In embryos, IPF1 expression is initiated prior to hormone gene expression and is restricted to the dorsal and ventral walls of the primitive foregut at the positions where pancreas will later form. The pattern of IPF1 expression and its ability to stimulate insulin gene transcription suggest that IPF1 functions both in the regionalization of the primitive gut endoderm and in the maturation of the pancreatic beta‐cell.