Diabetes in humans accelerates cardiovascular disease caused by atherosclerosis. The relative contributions of hyperglycemia and dyslipidemia to atherosclerosis in patients with diabetes are not clear, largely because there is a lack of suitable animal models. We therefore have developed a transgenic mouse model that closely mimics atherosclerosis in humans with type 1 diabetes by breeding low-density lipoprotein receptor–deficient mice with transgenic mice in which type 1 diabetes can be induced at will. These mice express a viral protein under control of the insulin promoter and, when infected by the virus, develop an autoimmune attack on the insulin-producing β cells and subsequently develop type 1 diabetes. When these mice are fed a cholesterol-free diet, diabetes, in the absence of associated lipid abnormalities, causes both accelerated lesion initiation and increased arterial macrophage accumulation. When diabetic mice are fed cholesterol-rich diets, on the other hand, they develop severe hypertriglyceridemia and advanced lesions, characterized by extensive intralesional hemorrhage. This progression to advanced lesions is largely dependent on diabetes-induced dyslipidemia, because hyperlipidemic diabetic and nondiabetic mice with similar plasma cholesterol levels show a similar extent of atherosclerosis. Thus, diabetes and diabetes-associated lipid abnormalities have distinct effects on initiation and progression of atherosclerotic lesions.