Diabetes mellitus is characterized by either the inability to produce insulin (Type 1 diabetes) and or as insensitivity to insulin secreted by the body (Type 2 diabetes). In either case, the body is unable to efficiently move blood glucose across cell membranes to be utilized. This leads to a variety of local and systemic detrimental effects. Current treatments for diabetes focus on exogenous insulin administration and dietary control. Provided herein are treatments of diabetes using a cellular therapy to ameliorate symptoms associated with both reduced insulin secretion and insulin sensitivity. Using induced-pluripotent stem (iPS) cells, beta-like (β-like) cells similar to the endogenous insulin secreting cells were derived. These β-like cells secreted insulin in response to glucose, and corrected a hyperglycemic phenotype in a mouse model of Type 2 diabetes via an iPS cell transplant. Within the Type 2 diabetes mouse model, a long term correction of hyperglycemia was achieved as measured by blood glucose and hemoglobin Alc measurements. Reduction of hyperglycemia was also seen in a chemically-induced mouse model for Type 1 diabetes.