Systemic administration of islet-derived antigens has been shown to protect against diabetes in the non-obese diabetic (NOD) mouse by the induction of antigen-specific regulatory T cells. Bystander regulation to related and unrelated islet-derived antigens (intramolecular and intermolecular recognition) in this context is recognized. We tested if intranasal administration of glutamic acid decarboxylase 65 (GAD 65)-derived peptides could protect against both autoimmune and, through bystander regulation, alloimmune responses in a NOD mouse model. Spontaneously diabetic female NOD mice underwent islet transplantation from either C57Bl/6 or NOD islet donors. Islet recipients were treated with intranasal GAD 65-derived peptides or control (ovalbumin) peptide pre- and post-transplantation. In-vitro analysis of the effect of inhalation was defined using lymph node proliferation assays and supernatant analysis for cytokines. GAD 65-derived peptide inhalation resulted in significant protection against recurrent autoimmune disease, with the generation of an interleukin (IL)-10-producing immune phenotype in a syngeneic islet transplant model. This phenotype, however, was not robust enough to protect against alloimmune responses. Inhalation of GAD-derived peptides induces an immunoregulatory response that protects against recurrent autoimmune, but not alloimmune responses in the NOD mouse.