Type 1 diabetes can be cured by transplanting insulin producing pancreatic islets into the liver. While recipients temporarily may not require insulin injections, long-term outcome is poor. Inadequate revascularization of grafts within the liver contributes to graft failure. In the current study, isolated mouse or human islets were transplanted to mouse skeletal muscle and systematically investigated for intra-islet vascular density and blood flow with intravital- and confocal-microscopy and compared to islets transplanted to liver. The function of muscle-implanted islets was investigated in alloxan-induced diabetic mice. Islets transplanted to the liver displayed very poor vascularization, whereas islets grafted into muscle revascularized with vessel densities, diameters and blood flow entirely comparable to islets within the intact pancreas. Similarly, isolated human islets transplanted to nu/nu mouse muscle became highly vascularized. Blood perfusion of transplanted mouse, but not human islets was organized in a core-to-mantle manner, corresponding to the diverse cyto-architecture of rodent and human islets. Finally, diabetic mice were cured by transplantation of 300 islets into the abdominal wall, proving the function of muscle engrafted islets. These results strongly suggest that muscle is a potentially pro-angiogenic site for clinical islet transplantation that promotes improved long-term islet function through functionally restored intra-islet blood perfusion.