The destruction of beta cells in type 1 diabetes (T1D) results in loss of insulin production and glucose homeostasis. Treatment of non-obese diabetic (NOD) mice with immune-depleting/modulating agents (e.g., anti-CD3, murine anti-thymocyte-globulin (mATG)) can lead to diabetes reversal. However, for preclinical studies with these and other agents seeking to reverse disease at onset, the necessity for exogenous insulin administration is debated. Spontaneously diabetic NOD mice were treated with a short-course of mATG and insulin provided as drug therapy or by way of allogeneic islet implants. Herein we demonstrate that exogenous insulin administration is required to achieve disease reversal with mATG in NOD mice. Unexpectedly, we also observed that provision of insulin by way of allogeneic islet implantation in combination with mATG leads to a pronounced reversal of diabetes as well as restoration of tolerance to self-islets. Expansion/induction of regulatory cells was observed in NOD mice stably cured with mATG and allogeneic islets. These data suggest that transient provision of allogeneic insulin-producing islets might provide a temporary window for immune depletion to be more effective and instilling stable tolerance to endogenous beta cells. These findings support the use of a never before explored approach for preserving beta cell function in patients with recent onset T1D.