Type 1 diabetes mellitus (T1DM) is an autoimmune disease mainly mediated by effector T cells that are activated by autoantigen, thereby resulting in the destruction of pancreatic islets and deficiency of insulin. Cyclosporine is widely used as an immunosuppressant that suppresses autoimmunity in clinic. However, continuous treatments with conventional immunosuppressive drugs may cause severe side effects. Therefore it is important to seek alternative medicine. Chinese medicine Ginseng and Astragalus granule (GAG) was used to successfully treat type 2 diabetes mellitus in clinic in China. Here we found that GAG ameliorated T1DM in autoimmune NOD mice by increasing the level of insulin and reducing the level of blood glucose. Treatments with both GAG and CsA further decreased the blood glucose level. Moreover, GAG increased both CD4+FoxP3+ and CD8+CD122+PD-1+ Treg numbers in both spleens and lymph nodes of NOD mice. In particular, GAG could reverse a decline in CD4+FoxP3+ Tregs resulted from CsA treatments. The percentage of effector/memory CD8+ T cells (CD44(high)CD62L(low)) was significantly reduced by GAG, especially in the presence of low-doses of CsA. Histopathology also showed that GAG attenuated cellular infiltration and lowered CD3+ T cell numbers around and in islets. Thus, we demonstrated that GAG ameliorated autoimmune T1DM by upregulating both CD4+FoxP3+ and CD8+CD122+PD-1+ Tregs while GAG synergized with CsA to further suppress autoimmunity and T1DM by reversing the decline in CD4+FoxP3+ Tregs resulted from CsA treatments. This study may have important clinical implications for the treatment of T1DM using traditional Chinese medicine.