Eukaryotic cells respond to stress in the endoplasmic reticulum (ER) resulting from insufficient protein folding capacity or altered ER homeostasis by activating the unfolded protein response (UPR). In mammalian cells the UPR is mediated by at least three ER-localized sensors/transducers, and the cellular response and susceptibility to ER stress is likely to be cell-type specific to some degree. Here, we review the response of pancreatic β-cells or islets to ER stress induced by pharmacological agents, misfolded insulin expression, excessive nutrient exposure and in animal models of type 2 diabetes. This review highlights the particular importance of PERK-mediated translational control and the transcriptional response in pancreatic β-cells and how these relate to the highly specialized function of β-cells, namely glucose-regulated insulin secretion and production. We examine how chronic ER stress may prematurely 'age' the β-cell or cause its genetic reprogramming to either reduce its ability to mount a cell survival response to ER stress, or impair normal function. Both could contribute to β-cell failure in diabetes. We also explore the therapeutic potential of targeting the UPR to preserve β-cell function.