Immunoisolation is a potentially important approach to transplanting islets without need for immunosuppressive drugs. Immunoisolation systems have been conceived in which the transplanted tissue is separated from the immune system of the host by an artificial barrier. These systems offer a solution to the problem of human islet procurement by permitting use of islets isolated from animal pancreases. The devices used are referred to as biohybrid artificial organs because they combine synthetic, selectively permeable membranes that block immune rejection with living transplants. Three major types of biohybrid pancreas devices have been studied. These include devices anastomosed to the vascular system as AV shunts, diffusion chambers, and microcapsules. Results in diabetic rodents and dogs indicate that biohybrid pancreas devices significantly improve glucose homeostasis and can function for more than a year. Recent progress made with this approach is discussed, and some of the remaining problems that must be resolved to bring this technology to clinical reality are addressed.