The importance of dendritic cells (DC) in the activation of T cells and in the maintenance of self-tolerance is well known. We investigated whether alterations in phenotype and function of DC may contribute to the pathogenesis of Type 1 diabetes (T1DM). Mature DC (mDC) from 18 children with T1DM and 10 age-matched healthy children were tested. mDC, derived from peripheral blood monocytes cultured for 6 days in presence of interleukin (IL)-4 and granulocyte-macrophage colony stimulating factor (GM-CSF) and stimulated with lipopolysaccharide (LPS) for the last 24 h, were phenotyped for the expression of the co-stimulatory molecules B7·1 and B7·2. In six patients and six controls allogenic mixed leucocyte reaction (AMLR) was performed using mDC and cord blood-derived naive T cells at a DC/T naive ratio of 1 : 200. Proliferation was assessed on day 7 by [3H]-thymidine incorporation assay. Mature DC derived from patients showed, compared with controls, a reduced expression of B7·1 [mean of fluorescence intensity (MFI): 36·2 ± 14·3 versus 72·9 ± 34·5; P = 0·004] and B7·2 (MFI: 122·7 ± 67·5 versus 259·6 ± 154·1; P = 0·02). We did not find differences in the HLA-DR expression (P = 0·07). Moreover, proliferative response of allogenic naive T cells cultured with mDC was impaired in the patients (13471 ± 9917·2 versus 40976 ± 24527·2 cpm, P = 0·04). We also measured IL-10 and IL-12 concentration in the supernatant of DC cultures. Interestingly, we observed in the patients a sevenfold higher level of IL-10 (P = 0·07) and a ninefold lower level of IL-12 (P = 0·01). Our data show a defect in the expression of the co-stimulatory molecules and an impairment of DC priming function, events that might contribute to T1DM pathogenesis.