There are three prerequisites for development of the autoimmune disease type 1 diabetes (T1D). First, β cell-reactive T cells need to be activated; second, the response needs to be proinflammatory; and finally, immune regulation of autoreactive responses must fail. Here, we describe our current understanding of the cell types and immune mechanisms involved in each of these steps leading to T1D. Novel findings regarding β cell involvement in its own destruction, the importance of the microbiota for instruction of the immune system, and recent data from studies in T1D patients are discussed. In addition, we summarise therapeutic approaches to T1D, and how these relate to the immune mechanisms involved in disease development.