Islet transplantation offers patients with type 1 diabetes mellitus freedom from long-term insulin therapy and a degree of metabolic control that is far superior to injected insulin. The hope is that near-perfect glucose control sustained over time will prevent progression of secondary diabetic complications. The selection of optimal immunosuppressive agents for islet transplantation has been a formidable challenge, given the need to overcome both autoimmune and alloimmune barriers, as well as the potential toxicity of immunosuppressive agents on transplanted islets. Early strategies relied on protocols that had proven success in solid organ transplantation and consisted of azathioprine, cyclosporine and corticosteroids. Under these protocols, fewer than 10% of patients were able to achieve insulin independence. The development of the 'Edmonton Protocol' dramatically transformed clinical outcomes in islet transplantation in recent years through the introduction of a more potent, less diabetogenic, and corticosteroid-free immunosuppressive regimen consisting of sirolimus, low-dose tacrolimus, and induction anti-interleukin-2 receptor antibody. While insulin independence rates under this protocol have been highly successful, patients must be maintained on lifelong immunosuppression. While the risk of malignancy, post-transplant lymphoma and sepsis have been low and diminishing in transplanted patients to date, fears of these complications and a host of drug-related adverse effects have precluded broader application. Patients undergoing islet transplantation today must exchange insulin for chronic immunosuppressive therapy, and therefore the procedure can only be justified in patients with very unstable forms of diabetes, or in those with another solid organ allograft who already endure the risks of immunosuppression. Advances in more specific and less toxic immunosuppressive agents together with progress in better understanding the biology of diabetes will lead to more suitable strategies to control both alloimmune and recurrent autoimmune reactions. These protocols, ultimately aimed at establishing tolerance, are an essential pre-requisite to move towards providing islet transplantation earlier in the course of the disease, including transplantation in children. This review addresses the evolution of immunosuppressive strategies in islet transplantation, and highlights some novel agents in pre-clinical development or in early clinical trials that may offer considerable promise in facilitating the induction of tolerance.