Our goal is to develop techniques for transplanting microencapsulated xenogeneic islets as a durable physiologic source of insulin for diabetic patients. In spontaneously diabetic NOD mice, encapsulated neonatal porcine islets plus CTLA4-Ig treatment reversed diabetes for over 100 days, but encapsulated islets without CTLA4-Ig were rejected in about 2 weeks and unencapsulated islets within 1 week. We compared the proliferative and cytokine responses of T cells from NOD mice transplanted with encapsulated porcine islets. Spleen cells (SPC) from rejecting NODs spontaneously proliferated in vitro, whereas SPC from mice with functioning grafts or non-transplanted NODs did not. Islet cells induced no proliferation above background with either normal or transplanted NOD SPC. However, we did detect cytokine secretion after stimulation with porcine islets. SPC from both rejecting and non-rejecting mice secreted IFNγ, IL-10, and TGFβ as well as low levels of IL-2, IL-12 and IL-4 when stimulated with islets. In addition, fluid from peritoneal cavities (the site of transplanted encapsulated islets) contained IFNγ, NO2, IL-12, and high levels of TGFβ. By contrast, porcine islets stimulated no cytokine secretion by cells from control NOD mice. We were surprised to find no significant differences in islet-induced proliferation or cytokines between NOD mice that rejected or accepted grafts. Therefore, we will test additional cytokines (for example, IL-1 and TNFα) that may be present in rejecting NODs but not in those with functioning grafts.