Diabetes mellitus (DM) is characterized by the loss or dysfunction pancreatic β-cells. Human amniotic epithelial cells (hAEC), which retain pluripotency markers and are readily obtainable from term placentas, represent a promising alternative source of stem cells. We investigated whether hAECs can be guided through pancreatic ontogeny to generate insulin-producing β-like cells. hAEC from uncomplicated term deliveries were expanded to passage 1 and exposed to a four-stage differentiation sequence that sequentially modulated Activin/WNT, KGF/TGF-β, retinoic-acid/hedgehog, and EGF/Noggin signaling. Stage progression was monitored by end-point RT-PCR and quantitative immunofluorescence for hallmark transcription factors. After definitive endoderm induction, 64% of cells were Brachyury positive and 71% were WNT3A positive; primitive-gut specification yielded 57% HNF1B(+) cells. Posterior foregut commitment produced 75% PDX1(+) and 60% Sox9(+) nuclei and the final endocrine stage generated 74% NKX2.2(+) cells, with 71% showing cytoplasmatic insulin and 51% C-peptide staining; insulin/C-peptide co-localization was confirmed by double labelling. Thus a chemically defined, four-step protocol can convert term-derived hAEC into insulin-producing β-like cells, supporting their use as an accessible platform for diabetes modelling and future cell-replacement therapies.