Beta (β) cell dysfunction or loss is the common pathological feature in all types of diabetes mellitus (diabetes). Resolving the underlying mechanism may facilitate the treatment of diabetes by preserving the β cell population and function. It is known that TGF-β signaling plays diverse roles in β cell development, function, proliferation, apoptosis, and dedifferentiation. Inhibition of TGF-β signaling expands β cell lineage in the development. However, deletion of Tgfbr1 has no influence on insulin demand-induced but abolishes inflammation-induced β cell proliferation. Among canonical TGF-β signaling, Smad3 but not Smad2 is the predominant repressor of β cell proliferation in response to systemic insulin demand. Deletion of Smad3 simultaneously improves β cell function, apoptosis, and systemic insulin resistance with the consequence of eliminated overt diabetes in diabetic mouse models, revealing Smad3 as a key mediator and ideal therapeutic target for type-2 diabetes. However, Smad7 shows controversial effects on β cell proliferation and glucose homeostasis in animal studies. On the other hand, overexpression of Tgfb1 prevents β cells from autoimmune destruction without influence on β cell function. All these findings reveal the diverse regulatory roles of TGF-β signaling in β cell biology.