We previously reported that co-stimulation blockade by abatacept limits the decline of β-cell function and the frequency of circulating CD4+ central memory (CD45RO+CD62L+) T (TCM) cells in new-onset type 1 diabetes. In human subjects receiving placebo we found a significant association between increase in CD4+ TCM cells and decline of β-cell function. To extend and refine these findings, we examined changes in human CD4+ and CD8+ naïve and memory T-cell subsets at greater resolution using polychromatic flow and mass cytometry. In the placebo group we successfully reproduced the original finding of a significant association between TCM and β-cell function, and extended this to other T-cell subsets. Furthermore, we show that abatacept treatment significantly alters the frequencies of a majority of CD4+ conventional and regulatory T-cell subsets; in general, antigen-naïve subsets increase and antigen-experienced decrease, while CD8+ T-cell subsets are relatively resistant to drug effects, indicating a lesser reliance on CD28-mediated co-stimulation. Importantly, abatacept uncouples the relationship between changes in T-cell subsets and β-cell function that is a component of the natural history of the disease. Although these data suggest immunological markers for predicting change in β-cell function in type 1 diabetes, the finding that abatacept blunts this relationship renders the biomarkers non-predictive for this type of therapy. In sum, our findings point to a novel mechanism of action for this successful immunotherapy that may guide other disease-modifying approaches for type 1 diabetes.