In type 1 diabetes, the replacement of the destroyed beta cells could restore physiological glucose regulation and eliminate the need for exogenous insulin. Immunoisolation of these foreign cellular transplants via biomaterial encapsulation is widely used to prevent graft rejection. While highly effective in blocking direct cell‐to‐cell contact, nonspecific inflammatory reactions to the implant lead to the overproduction of reactive oxygen species, which contribute to foreign body reaction and encapsulated cell loss. For antioxidant protection, cerium oxide nanoparticles (CONPs) are a self‐renewable, ubiquitous, free radical scavenger currently explored in several biomedical applications. Herein, 2–12 alternating layers of CONP/alginate are assembled onto alginate microbeads containing beta cells using a layer‐by‐layer (LbL) technique. The resulting nanocomposite coatings demonstrate robust antioxidant activity. The degree of cytoprotection correlates with layer number, indicating tunable antioxidant protection. Coating of alginate beads with 12 layers of CONP/alginate provides complete protection to the entrapped beta cells from exposure to 100 × 10−6 m H2O2, with no significant changes in cellular metabolic activity, oxidant capacity, or insulin secretion dynamics, when compared to untreated controls. The flexibility of this LbL method, as well as its nanoscale profile, provides a versatile approach for imparting antioxidant protection to numerous biomedical implants, including beta cell transplantation.