Biologic treatment of type 1 diabetes (T1D) with agents including anti-CD3 (otelixizumab and teplizumab), anti-CD20 (rituximab), LFA3Ig (alafacept), and CTLA4Ig (abatacept) results in transient stabilization of insulin C-peptide, a surrogate for endogenous insulin secretion. With the goal of inducing more robust immune tolerance, we used systems biology approaches to elucidate mechanisms associated with C-peptide stabilization in clinical trial blood samples from new-onset T1D subjects treated with the B cell-depleting drug, rituximab. RNA sequencing (RNA-seq) analysis of whole-blood samples from this trial revealed a transient increase in heterogeneous T cell populations, which were associated with decreased pharmacodynamic activity of rituximab, increased proliferative responses to islet antigens, and more rapid C-peptide loss. Our findings illustrate complexity in hematopoietic remodeling that accompanies B cell depletion by rituximab, which impacts and predicts therapeutic efficacy in T1D. Our data also suggest that a combination of rituximab with therapy targeting CD4 + T cells may be beneficial for T1D subjects.