Islet transplantation represents a potential cure for type 1 diabetes, yet persistent autoimmune and allogeneic immunities currently limit its clinical efficacy. For alleviating the autoimmune destruction of transplanted islets, newly diagnosed NOD mice were provided a single intramuscular injection of recombinant adeno-associated viral vector encoding murine IL-10 (rAAV-IL-10) 4 weeks before renal capsule delivery of 650 syngeneic islets. A dose-dependent protection of islet grafts was observed. Sixty percent (3 of 5) of NOD mice that received a transduction of a high-dose (4 × 109 infectious units) rAAV-IL-10 remained normoglycemic for at least 117 days, whereas diabetes recurred within 17 days in mice that received a low-dose rAAV-IL-10 (4 × 108 infectious units; 5 of 5) as well as in all of the control mice (5 of 5 untreated and 4 of 4 rAAV-green fluorescent protein-transduced). Serum IL-10 levels positively correlated with prolonged graft survival and were negatively associated with the intensity of autoimmunity. The mechanism of rAAV-IL-10 protection involved a reduction of lymphocytic infiltration as well as induction of antioxidant enzymes manganese superoxide dismutase and heme oxygenase 1 in islet grafts. These studies support the utility of immunoregulatory cytokine gene therapy delivered by rAAV for preventing autoimmune disease recurrence in transplant-based therapies for type 1 diabetes.