Background. FTY720 prevents allograft rejection with remarkable potency without inducing generalized immunosuppression. We determined the effect of FTY720 on development of autoimmune diabetes in nonobese diabetic (NOD) mice. Methods. NOD mice were given FTY720 (0.5 mg/kg, orally) five times per week starting from 4 weeks of age. Results. Daily FTY720 prevented development of diabetes in 15 of 16 treated mice, whereas 70% of untreated NOD mice became diabetic by 35 weeks of age. Withdrawal of FTY720 at 35 weeks of age led to development of diabetes within 2 weeks in five mice, whereas the remaining mice maintained diabetes-free conditions for up to 44 weeks of age. No side effect of the drug was seen throughout the treatment period. FTY720 also prevented cyclophosphamide-induced diabetes in NOD mice. Conclusions. FTY720 is a safe and benign therapeutic agent that may be used chronically in prediabetic individuals.