OBJECTIVE: To evaluate the disease-modifying potential of SM03, a novel humanized anti-CD22 monoclonal antibody, for B cell-mediated autoimmune diseases by investigating its mechanism for suppressing B cell dysregulation in autoimmune milieu. METHODS: SM03's mechanism was assessed in-vitro using functional assays on stimulated human PBMC from healthy donors and patients with Systemic Lupus Erythematosus (SLE)/Sjögren's Syndrome (SS). The efficacy of SM03 to attenuate autoimmunity was then evaluated in-vivo in a humanized pristane-induced SLE mouse model as well as a preventive collagen-induced Rheumatoid Arthritis (RA) model in cynomolgus monkeys. Disease-specific biomarkers, histopathology, and immune cell phenotypes were analyzed. RESULTS: SM03 attenuated T cell-dependent B cell activation by reducing class-switched B cells, plasmablast differentiation, and pro-inflammatory cytokine production in B cell lines, healthy and disease PBMCs, without inducing B cell depletion. In the SLE model, SM03 suppressed key disease manifestations (splenomegaly, anti-dsDNA, proteinuria, glomerular deposits) and reduced activated T cells without broad B cell depletion. In the RA model, SM03 dose-dependently suppressed joint scores, cartilage damage, synovial hyperplasia, anti-collagen II antibodies, and IL-6. CONCLUSION: By enhancing CD22's inhibitory signalling to disrupt autoreactive B-T cell interactions, SM03 functions as a disease-modifying therapy that attenuates dysregulation of lymphocytes in autoimmunity. This non-depleting mechanism supports its translational potential for SLE and RA and implicates its broader utility for other B cell-driven autoimmune diseases.