Beginning at the time of insulitis, nonobese diabetic (NOD) mice demonstrate a thymocyte and peripheral T cell proliferative hyporesponsiveness induced by TCR cross-linking, which is associated with reduced IL-2 and IL-4 secretion. We previously reported that NOD CD4+ T cell hyporesponsiveness is reversed completely in vitro by exogenous IL-4, and that administration of IL-4 to NOD mice prevents the onset of insulin-dependent diabetes mellitus (IDDM). This result suggested that T cell-mediated destruction of pancreatic islet beta cells may result from a hyporesponsiveness in regulatory Th2 cells favoring a Th1 cell-mediated environment in the pancreas. In the present study, we tested this possibility by analysis of the mechanisms of protection from IDDM afforded by IL-4 treatment in NOD mice. We show that IL-4 protects NOD mice from insulitis and IDDM when administered i.p. three times a week for 10 wk beginning at 2 wk of age. This occurs by the modulation of the homing of autoreactive cells to inflammatory sites and the stabilization of a protective Th2-mediated environment in the thymus, spleen, and pancreatic islets. Thus, IL-4 treatment favors the expansion of regulatory CD4+ Th2 cells in vivo and prevents the onset of insulitis and IDDM mediated by autoreactive Th1 cells.