Abstract Background The vertebrate pancreas contains islet, acinar and ductal cells. These cells derive from a transient pool of multipotent pancreatic progenitors during embryonic development. Insight into the genetic determinants regulating pancreatic organogenesis will help the development of cell-based therapies for the treatment of diabetes mellitus. Suppressor enhancer lin12/Notch 1 like (Sel1l) encodes a cytoplasmic protein that is highly expressed in the developing mouse pancreas. However, the morphological and molecular events regulated by Sel1l remain elusive. Results We have characterized the pancreatic phenotype of mice carrying a gene trap mutation in Sel1l. We show that Sel1l expression in the developing pancreas coincides with differentiation of the endocrine and exocrine lineages. Mice homozygous for the gene trap mutation die prenatally and display an impaired pancreatic epithelial morphology and cell differentiation. The pancreatic epithelial cells of Sel1l mutant embryos are confined to the progenitor cell state throughout the secondary transition. Pharmacological inhibition of Notch signaling partially rescues the pancreatic phenotype of Sel1l mutant embryos. Conclusions Together, these data suggest that Sel1l is essential for the growth and differentiation of endoderm-derived pancreatic epithelial cells during mouse embryonic development.