Autoaggressive T cells directed against insulin secreting pancreatic beta-cells mediate the development of type 1 diabetes. Islet transplantation offers superior glycemic control over exogenous insulin, but chronic immunosuppression limits its broad application. Pathogenic T cells are also important in allograft rejection. Inducing and maintaining antigen-specific peripheral T-cell tolerance toward beta-cells is an attractive strategy to prevent autoimmune disease, and to facilitate treatment of diabetes with islet allografts without long-term immunosuppression. Recent efforts have focused on blocking costimulatory T-cell signals for tolerance induction. Although costimulatory blockade can prolong graft survival, true immunological tolerance remains elusive. Costimulatory signals may even be required for the maintenance of peripheral tolerance. The discovery of novel coinhibitory T-cell pathways, including CTLA-4, PD-1, and BTLA, offers an alternative approach. Stimulating negative T cell cosignals alone or in combination may help induce tolerance. The focus of this review is to summarize the strategies directed at turning off the immune response by exploiting these negative cosignaling pathways in tolerance induction in islet transplantation. Activating several coinhibitory pathways together may be synergistic in preventing pathogenic T-cell responses. Tolerance induction will likely rely on understanding the balance of positive and negative signals affecting the state of T-cell activation.