The rate of decline in insulin secretion after diagnosis with type 1 diabetes (T1D) varies substantially among individuals and with age at diagnosis, but the mechanism (s) behind this heterogeneity are not well understood. We investigated the loss of pancreatic β cell function in new-onset T1D subjects using unbiased whole blood RNA-seq and verified key findings by targeted cell count measurements. We found that patients who lost insulin secretion more rapidly had immune phenotypes (“immunotypes”) characterized by higher levels of B cells and lower levels of neutrophils, especially neutrophils expressing primary granule genes. The B cell and neutrophil immunotypes showed strong age dependence, with B cell levels in particular predicting rate of progression in young subjects only. This age relationship suggested that therapy targeting B cells in T1D would be most effective in young subjects with high pretreatment B cell levels, a prediction which was supported by data from a clinical trial of rituximab in new-onset subjects. These findings demonstrate a link between age-related immunotypes and disease outcome in new-onset T1D. Furthermore, our data suggest that greater success could be achieved by targeted use of immunomodulatory therapy in specific T1D populations defined by age and immune characteristics.