Type 1 diabetes (T1D) is characterized by pancreatic islet infiltration by autoreactive immune cells and a nearly complete loss of β cells 1. Restoration of insulin-producing β cells coupled with immunomodulation to suppress the autoimmune attack has emerged as a potential approach to counter T1D 2, 3, 4. Here we report that enhancing β-cell mass early in life, in two models of female non-obese diabetic (NOD) mice, results in immunomodulation of T cells, reduced islet infiltration and lower β-cell apoptosis, which together protect them from developing T1D. The animals displayed altered β-cell antigens; islet transplantation studies showed prolonged graft survival in the NOD-liver-specific insulin receptor knockout (LIRKO) model. Adoptive transfer of splenocytes from NOD-LIRKO mice prevented development of diabetes in prediabetic NOD mice. A substantial increase in the splenic CD4+ CD25+ Foxp3+ regulatory T cell (T reg) population was observed to underlie the protected phenotype since T reg-cell depletion rendered NOD-LIRKO mice diabetic. An increase in T reg cells coupled with activation of transforming growth factor-β/SMAD family member 3 signalling pathway in pathogenic T cells favoured reduced ability to kill β cells. These data support a previously unidentified observation that initiating β-cell proliferation, alone, before islet infiltration by immune cells alters the identity of β cells, decreases pathological self-reactivity of effector T cells and increases T reg cells to prevent the progression of T1D.