The dynamics of CD4(+) effector T cells (Teff cells) and CD4(+)Foxp3(+) regulatory T cells (Treg cells) during diabetes progression in nonobese diabetic mice was investigated to determine whether an imbalance of Treg cells and Teff cells contributes to the development of type 1 diabetes. Our results demonstrated a progressive decrease in the Treg cell:Teff cell ratio in inflamed islets but not in pancreatic lymph nodes. Intra-islet Treg cells expressed reduced amounts of CD25 and Bcl-2, suggesting that their decline was due to increased apoptosis. Additionally, administration of low-dose interleukin-2 (IL-2) promoted Treg cell survival and protected mice from developing diabetes. Together, these results suggest intra-islet Treg cell dysfunction secondary to defective IL-2 production is a root cause of the progressive breakdown of self-tolerance and the development of diabetes in nonobese diabetic mice.