Type 1 diabetes (also known as insulin-dependent diabetes mellitus or juvenile-onset diabetes) is usually caused by T cell-mediated autoimmunity, with a prediabetic state characterized by the production of autoantibodies specific for proteins expressed by pancreatic beta cells. The non-obese diabetic (NOD) mouse is a spontaneous model of type 1 diabetes with a strong genetic component that maps to the major histocompatibility complex (MHC) region of the genome. A specific proteasome defect has been identified in NOD mouse lymphocytes that results from down-regulation of expression of the proteasome subunit LMP2, which is encoded by a gene in the MHC genomic region. This defect both prevents the proteolytic processing required for the production and activation of the transcription factor nuclear factor kappaB (NF-kappaB), which plays important roles in immune and inflammatory responses, as well as increases the susceptibility of the affected cells to apoptosis induced by tumor necrosis factor alpha (TNF-alpha). The proteasome dysfunction is both tissue and developmental stage specific and likely contributes to disease pathogenesis and tissue targeting.