Islet transplantation is an emerging therapy for type 1 diabetes and hypoglycemic unawareness. However, a key challenge for islet transplantation is cellular rejection and the requirement for long-term immunosuppression. In this study, we established a diabetic humanized NOD-scidIL2Rγ^null (NSG) mouse model of T-cell–mediated human islet allograft rejection and developed a therapeutic regimen of low-dose recombinant human interleukin-2 (IL-2) combined with low-dose rapamycin to prolong graft survival. NSG mice that had received renal subcapsular human islet allografts and were transfused with 1 × 10⁷ of human spleen mononuclear cells reconstituted human CD45⁺ cells that were predominantly CD3⁺ T cells and rejected their grafts with a median survival time of 27 days. IL-2 alone (0.3 × 10⁶ IU/m² or 1 × 10⁶ IU/m²) or rapamycin alone (0.5–1 mg/kg) for 3 weeks did not prolong survival. However, the combination of rapamycin with IL-2 for 3 weeks significantly prolonged human islet allograft survival. Graft survival was associated with expansion of CD4⁺CD25⁺FOXP3⁺ regulatory T cells (Tregs) and enhanced transforming growth factor-β production by CD4⁺ T cells. CD8⁺ T cells showed reduced interferon-γ production and reduced expression of perforin-1. The combination of IL-2 and rapamycin has the potential to inhibit human islet allograft rejection by expanding CD4⁺FOXP3⁺ Tregs in vivo and suppressing effector cell function and could be the basis of effective tolerance-based regimens.