Background/Objectives: Human pancreatic islet transplantation shows promise for long-term glycemic control in diabetes patients. A shortage of healthy donors and the need for continuous immunosuppressive therapy complicates this. Enhancing our understanding of the immune tolerance mechanisms related to graft rejection is crucial to generate safer transplantation strategies. This review will examine advancements in immune protection strategies for stem cell-derived islet therapy and discuss key clinical trials involving stem cell-derived β-cells and their protective strategies against the host immune system. Methods: A comprehensive literature search was performed on peer-reviewed publications on Google Scholar, Pubmed, and Scopus up to September 2024 to extract relevant studies on the various strategies of immune evasion of stem cell-derived β-cells in humans. The literature search was extended to assimilate all relevant clinical studies wherein stem cell-derived β-cells are transplanted to treat diabetes. Results: Our analysis highlighted the importance of human pluripotent stem cells (hPSCs) as a potentially unlimited source of insulin-producing β-cells. These cells can be transplanted as an effective source of insulin in diabetes patients if they can be protected against the host immune system. Various strategies of immune protection, such as encapsulation and genetic manipulation, are currently being studied and clinically tested. Conclusions: Investigating immune tolerance in hPSC-derived islets may help achieve a cure for diabetes without relying on exogenous insulin. Although reports of clinical trials show promise in reducing insulin dependency in patients, their safety and efficacy needs to be further studied to promote their use as a long-term solution to cure diabetes.
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