This is a randomized, placebo-controlled phase II study to investigate if a prime and boost of 20ug Diamyd® (rhGAD65 formulated in Alhydrogel®), administered subcutaneously four weeks apart, is safe and can preserve beta cell function in children and adolescents with type 1 diabetes with a diabetes duration less than 18 months at intervention.

Key Inclusion Criteria:

• Male and female patients between 10 and 18 years of age, diagnosed with type 1 diabetes within 18 months
• Fasting C-peptide level above 0.1 nmol/l
• Presence of GAD65 antibodies
• Written informed consent (patient and parent/guardian)

Key Exclusion Criteria:

• Secondary diabetes mellitus or MODY
• Treatment with immunosuppressants
• Treatment with any vaccine within 1 month prior to first Diamyd® dose or planned treatment with vaccine up to 2 months after the second Diamyd® dose
• Participation in other clinical trials with a new chemical entity within the previous 3 months
• History of certain diseases or conditions (e.g. epilepsy, anaemia, alcohole or drug abuse)
• HIV or hepatitis
• Presence of associated serious disease or condition which in the opinion of the investigator makes the patient non-eligible for the study
• Pregnancy (or planned pregnancy within one year after 2nd administration)