OBJECTIVE Autoimmune diabetes is a T cell–mediated disease in which insulin-producing β-cells are destroyed. Autoreactive T cells play a central role in mediating β-cell destruction. B7-H4 is a negative cosignaling molecule that downregulates T-cell responses. In this study, we aim to determine the role of B7-H4 on regulation of β-cell–specific autoimmune responses. RESEARCH DESIGN AND METHODS Prediabetic (aged 3 weeks) female NOD mice (group 1, n = 21) were treated with intraperitoneal injections of B7-H4.Ig at 7.5 mg/kg, with the same amount of mouse IgG (group 2, n = 24), or with no protein injections (group 3, n = 24), every 3 days for 12 weeks. RESULTS B7-H4.Ig reduced the incidence of autoimmune diabetes, compared with the control groups (diabetic mice 28.6% of group 1, 66.7% of group 2 [P = 0.0081], and 70.8% of group 3 [group 1 vs. 3, P = 0.0035]). Histological analysis revealed that B7-H4 treatment did not block islet infiltration but rather suppressed further infiltrates after 9 weeks of treatment (group 1 vs. 2, P = 0.0003). B7-H4 treatment also reduced T-cell proliferation in response to GAD65 stimulation ex vivo. The reduction of diabetes is not due to inhibition of activated T cells in the periphery but rather to a transient increase of Foxp3+ CD4+ T-cell population at one week posttreatment (12.88 ± 1.29 vs. 11.58 ± 1.46%; n = 8; P = 0.03). CONCLUSIONS Our data demonstrate the protective role of B7-H4 in the development of autoimmune diabetes, suggesting a potential means of preventing type 1 diabetes by targeting the B7-H4 pathway.