Pancreatic β-cells are an essential source of insulin and their destruction because of autoimmunity causes type I diabetes. We conducted a chemical screen to identify compounds that would induce the differentiation of insulin-producing β-cells in vivo. To do this screen, we brought together the use of transgenic zebrafish as a model of β-cell differentiation, a unique multiwell plate that allows easy visualization of lateral views of swimming larval fish and a library of clinical drugs. We identified six hits that can induce precocious differentiation of secondary islets in larval zebrafish. Three of these six hits were known drugs with a considerable background of published data on mechanism of action. Using pharmacological approaches, we have identified and characterized two unique pathways in β-cell differentiation in the zebrafish, including down-regulation of GTP production and retinoic acid biosynthesis.