B cell-deficient nonobese diabetic (NOD) mice are protected from the development of spontaneous autoimmune diabetes, suggesting a requisite role for Ag presentation by B lymphocytes for the activation of a diabetogenic T cell repertoire. This study specifically examines the importance of B cell-mediated MHC class II Ag presentation as a regulator of peripheral T cell tolerance to islet β cells. We describe the construction of NOD mice with an IA g7 deficiency confined to the B cell compartment. Analysis of these mice, termed NOD B CIID, revealed the presence of functionally competent non-B cell APCs (macrophages/dendritic cells) with normal IA g7 expression and capable of activating Ag-reactive T cells. In addition, the secondary lymphoid organs of these mice harbored phenotypically normal CD4+ and CD8+ T cell compartments. Interestingly, whereas control NOD mice harboring IA g7-sufficient B cells developed diabetes spontaneously, NOD B CIID mice were resistant to the development of autoimmune diabetes. Despite their diabetes resistance, histologic examination of pancreata from NOD B CIID mice revealed foci of noninvasive peri-insulitis that could be intentionally converted into a destructive process upon treatment with cyclophosphamide. We conclude that IA g7-mediated Ag presentation by B cells serves to overcome a checkpoint in T cell tolerance to islet β cells after their initial targeting has occurred. Overall, this work indicates that the full expression of the autoimmune potential of anti-islet T cells in NOD mice is intimately regulated by B cell-mediated MHC class II Ag presentation.