Monogenic diabetes refers to diabetes mellitus (DM) caused by a mutation in a single gene and accounts for approximately 1%-5% of diabetes. Correct diagnosis is clinically critical for certain types of monogenic diabetes, since the appropriate treatment is determined by the etiology of the disease (e.g., oral sulfonylurea treatment of HNF1A/HNF4A-diabetes vs. insulin injections in type 1 diabetes). However, achieving a correct diagnosis requires genetic testing, and the overlapping of the clinical features of monogenic diabetes with those of type 1 and type 2 diabetes has frequently led to misdiagnosis. Improvements in sequencing technology are increasing opportunities to diagnose monogenic diabetes, but challenges remain. In this Review, we describe the types of monogenic diabetes, including common and uncommon types of maturity-onset diabetes of the young, multiple causes of neonatal DM, and syndromic diabetes such as Wolfram syndrome and lipodystrophy. We also review methods of prioritizing patients undergoing genetic testing, and highlight existing challenges facing sequence data interpretation that can be addressed by forming collaborations of expertise and by pooling cases.