Bioartificial pancreas, microencapsulation of islets of Langerhans (islets) within devices has been studied as a safe and simple technique for islet transplantation without the need for immuno-suppressive therapy. Various types of bioartificial pancreas have been proposed and developed such as microcapsule, macrocapsule and diffusion chamber types. However, these materials comprising a bioartificial pancreas are not completely inert and may induce foreign body and inflammatory reactions. The residual materials would be a problem in human body. Here we propose an alternative method for microencapsulation of islets with a layer of living cells. We immobilized HEK293 cells (human endoderm kidney cell line) to the islet surface using amphiphilic poly(ethylene glycol)-conjugated phospholid derivative and biotin/streptavidin reaction and encapsulated islets with a cell layer by culture. No necrosis of islet cells at the center was seen after microencapsulation with a layer of living cells. Insulin secretion ability by glucose stimulation was well maintained on these cell-encapsulated islets.