Dr. Shane Grey and his colleagues have found a way to stop the genetic condition from occurring in mice bred to spontaneously develop it and, he says, it appeared the protection was life-long.
The technique also had a 100 percent success rate for the mice involved in the study, undertaken at Sydney's The Garvan Institute.
"It does sound too good to be true," Dr Grey told AAP.
"We helped the immune system to re-educate itself, and it was tolerant again of the (mice's) insulin producing cells.
"That then gives very strong support to the idea that our drug treatment would give life-long protection."
More than 140,000 Australians have Type 1 diabetes, a condition which causes their immune system to kill off their ability to make insulin.
The genetic fault is present from birth but the condition may not strike until adulthood, and without daily insulin injections these people would lapse into a potentially fatal coma.
The study found a chemical compound (BCMA-Fc), known to have potential benefits in combating a range of auto-immune disease, was effective in this case at stopping the onset of Type 1 diabetes.
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