Islet transplantation to treat insulin-dependent diabetes is greatly limited by the need for maintenance immunosuppression. We report a strategy through which cotransplantation of allogeneic islets and streptavidin (SA)-FasL-presenting microgels to the omentum under transient rapamycin monotherapy resulted in robust glycemic control, sustained C-peptide levels, and graft survival in diabetic nonhuman primates for >6 months. Surgical extraction of the graft resulted in prompt hyperglycemia. In contrast, animals receiving microgels without SA-FasL under the same rapamycin regimen rejected islet grafts acutely. Graft survival was associated with increased number of FoxP3+ cells in the graft site with no significant changes in T cell systemic frequencies or responses to donor and third-party antigens, indicating localized tolerance. Recipients of SA-FasL microgels exhibited normal liver and kidney metabolic function, demonstrating safety. This localized immunomodulatory strategy succeeded with unmodified islets and does not require long-term immunosuppression, showing translational potential in β cell replacement for treating type 1 diabetes.