Antagonism of CXCR4 disrupts the interaction between the CXCR4 receptor on hematopoietic stem cells (HSCs) and the CXCL12 expressed by stromal cells in the bone marrow, which subsequently results in the shedding of HSCs to the periphery. Because of their profound immunomodulatory effects, HSCs have emerged as a promising therapeutic strategy for autoimmune disorders. We sought to investigate the immunomodulatory role of mobilized autologous HSCs, via target of the CXCR4-CXL12 axis, to promote engraftment of islet cell transplantation. Islets from BALB/c mice were transplanted beneath the kidney capsule of hyperglycemic C57BL/6 mice, and treatment of recipients with CXCR4 antagonist resulted in mobilization of HSCs and in prolongation of islet graft survival. Addition of rapamycin to anti-CXCR4 therapy further promoted HSC mobilization and islet allograft survival, inducing a robust and transferable host hyporesponsiveness, while administration of an ACK2 (anti-CD117) mAb halted CXCR4 antagonist-mediated HSC release and restored allograft rejection. Mobilized HSCs were shown to express high levels of the negative costimulatory molecule programmed death ligand 1 (PD-L1), and HSCs extracted from wild-type mice, but not from PD-L1 knockout mice, suppressed the in vitro alloimmune response. Moreover, HSC mobilization in PD-L1 knockout mice failed to prolong islet allograft survival. Targeting the CXCR4-CXCL12 axis thus mobilizes autologous HSCs and promotes long-term survival of islet allografts via a PD-L1-mediated mechanism.