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Pancreatic β cells are central to glycemic regulation through insulin production. Studies show autophagy as an essential process in β cell function and fate. Autophagy is a catabolic cellular process that regulates cell homeostasis by recycling surplus or damaged cell components. Impaired autophagy results in β cell loss of function and apoptosis and, as a result, diabetes initiation and progress. It has been shown that in response to endoplasmic reticulum stress, inflammation, and high metabolic demands, autophagy affects β cell function, insulin synthesis, and secretion. This review highlights recent evidence regarding how autophagy can affect β cells’ fate in the pathogenesis of diabetes. Furthermore, we discuss the role of important intrinsic and extrinsic autophagy modulators, which can lead to β cell failure.