Type 1 diabetes mellitus (T1DM) is a chronic disorder that results from autoimmune-mediated destruction of pancreatic islet β cells. However, no conventional intervention has successfully treated the disease to date. The optimal therapeutic method for T1DM should effectively control the autoimmunity, restore immune homeostasis, preserve the residual β cells, reverse β-cell destruction, and protect the regenerated insulin-producing cells against the re-attacking. Umbilical cord blood is rich in regulatory T cells (Tregs) and multiple types of stem cells, which display immunomodulating potential and hold the promise in their ability to restore peripheral tolerance toward pancreatic islet β cells through remodeling of the immune responses and suppressing the autoreactive T cells. Recently, reinfusion of autologous umbilical cord blood or immune cells from cord blood has been proposed as a novel therapy for T1DM, with the advantages of no risk to the donors, minimal ethical concerns, low incidence of graft-versus-host disease (GVHD) and easy accessibility. In this review, we revisit the role of autologous umbilical cord blood or immune cells from cord blood based applications for the treatment of T1DM.