Abstract: An artificial pancreas system which minimizes the volume of the artificial pancreas by not encapsulating each islet is taught wherein the islets are separated and held within a polymeric matrix which is soluble in an aqueous solution below body temperature but insoluble in aqueous solutions at or above body temperature. The polymer-islet mixture is contained in a pouch having access means such as entry and exit ports. The solubility makes it possible to replace the contents of the pouch by solubilizing the matrix simply by lowering the temperature below the LCST. The pouch is constructed of a biocompatible material permeable to insulin and other substances of similar or lesser molecular weight but is impermeable to cellular and humoral components of the body immune system. The islet-polymer matrix can be functionalized to stimulate insulin secretion from the islets using insulinotropic agents such as sulfonylurea.