Islet amyloid has been recognized as a pathological entity in type 2 diabetes since the turn of the century. It has as its unique component the islet beta-cell peptide islet amyloid polypeptide (IAPP), or amylin, which is cosecreted with insulin. In addition to this unique component, islet amyloid contains other proteins, such as apolipoprotein E and the heparan sulfate proteoglycan perlecan, which are typically observed in other forms of generalized and localized amyloid. Islet amyloid is observed at pathological examination in the vast majority of individuals with type 2 diabetes but is rarely observed in humans without disturbances of glucose metabolism. In contrast to IAPP from rodents, human IAPP has been shown to form amyloid fibrils in vitro. Because all human subjects produce and secrete the amyloidogenic form of IAPP, yet not all develop islet amyloid, some other factor(s) must be involved in islet amyloid formation. One hypothesis is that an alteration in beta-cell function resulting in a change in the production, processing, and/or secretion of IAPP is critical to the initial formation of islet amyloid fibrils in human diabetes. This nidus of amyloid fibrils then allows the progressive accumulation of IAPP-containing fibrils and the eventual replacement of beta-cell mass by amyloid and contributes to the development of hyperglycemia. One factor that may be involved in producing the changes in the beta-cell that result in the initiation of amyloid formation is the consumption of increased dietary fat. Dietary fat is known to alter islet beta-cell peptide production, processing, and secretion, and studies in transgenic mice expressing human IAPP support the operation of this mechanism. Further investigation using this and other models should provide insight into the mechanism(s) involved in islet amyloidogenesis and allow the development of therapeutic agents that inhibit or reverse amyloid fibril formation, with the goal being to preserve beta-cell function and improve glucose control in type 2 diabetes.