The Pancreas
The pancreas is composed of two main parts, the exocrine part and the endocrine pancreas. The exocrine part secretes substances into the intestinal tract which help in digestion of the eaten food. These include lipase, which helps to digest fat, and amylase that helps to digest starchy foods. It also releases 'bicarbonate of soda' to neutralise any stomach acid that may otherwise damage the lining of the gut. The exocrine pancreas is directly connected to the intestinal tract through the pancreatic duct as seen below.

But we are basically concerned in diabetes with the endocrine pancreas which is the source of insulin, glucagon and other hormones, secreted directly into the bloodstream.

The pancreas is full of tiny cluster of cells called the Islets of Langerhans, which surround the cells of the "exocrine" pancreas.

The islet of Langerhans contains many types of cells

The pancreas has many islets that contain insulin-producing beta cells and glucagon-producing alpha cells.

Proinsulin, secreted as insulin and C-Peptide
Insulin is made and secreted by the beta cells of the pancreatic islets, small islands of endocrine cells in the pancreas. In the beta cell, the insulin is made and stored as a precursor called proinsulin. When the B cell is appropriately stimulated, insulin is secreted from the cell by exocytosis and diffuses into islet capillary blood. C peptide is also secreted into blood, but has no known biological activity.
Insulin is a protein hormone that contains 51 amino acids
After a meal the digestive system breaks some food down into glucose. The blood carries the glucose or sugar throughout the body, causing blood glucose levels to rise.

In response to this rise the hormone insulin is released into the bloodstream to signal the body tissues to metabolize or burn the glucose for fuel, causing blood glucose levels to return to normal.

Glucose the body doesn't use right away goes to the liver, muscle or fat for storage.
Under normal circumstances the hormone insulin, which is made by the pancreas, carefully regulates how much glucose is in the blood. Insulin stimulates cells to absorb enough glucose from the blood for the energy, or fuel, that they need. Insulin also stimulates the liver to absorb and store any glucose that's left over. After a meal the amount of glucose in the blood rises, and this triggers the release of insulin.

When blood glucose levels fall, during exercise for example, insulin levels fall too. A second hormone manufactured by the pancreas is called glucagon. It stimulates the liver to release glucose when it's needed, and this raises the level of glucose in the blood.