Transdifferentiattion potential of mesenchymal stem cells (MSCs) into insulin-producing cells (IPCs) has been suggested recently. In our recent works, we demonstrated the high performance of mouse neonate pancreas extract (MPE) in the production of functional IPCs from carcinoma stem cells. In this study, MPE was used to generate IPCs from MSCs without any genetic manipulation. To this end, bone marrow MSCs were isolated and characterized. In order to differentiate, MSCs were induced by selection of nestin-expressing cells and treatment with 100μg/mL MPE. Morphological features of the differenti-ated cells were confirmed by dithizone staining. Immunoreactivity to insulin receptor beta, proinsulin, insulin, and C-peptide was observed by immunoflourescence. We also quantified glucose-dependent insulin production and secretion by ELISA. Real-time PCR indicated the expressions of β cell-related genes, PDX-1, INS1, INS2, EP300, and CREB1, in IPC cells. Possible pathways governed by CREB1, EP300, and PDX-1 transcription factors in differentiation of MSCs to IPCs were determined based on Gene Set Enrichment (GSE) approach at P=0.05. Pathway discovery highlighted the negative regulatory effects of MIR124-2, HDAC5 protein, REST, and NR0B2 transcription factors on expression of CREB1, EP300, and PDX-1 and inhabitation of IPC differentiations. In contrast, a crosstalk between FOXA2 and TCF7L2 transcription factors, DNA-PK complex, KAT2B protein positively interacting with PDX-1, CREB1, EP300 resulted in the induction of IPC and following insulin production. In conclusion, we report an efficient, simple, and easy method for production of functional IPCs from MSCs by MPE treatment.