A double-blind controlled trial of azathioprine (2 mg · kg⁻¹ · day⁻¹) was conducted with 49 patients aged 2–20 yr (mean 10.8 yr) who had newly diagnosed type I (insulin-dependent) diabetes. Patients were randomly assigned to receive either azathioprine (n = 24) or placebo (n = 25) for 12 mo, beginning within the 20 day period after diagnosis. Baseline clinical and metabolic characteristics did not differ between the two groups. No patient experienced complete remission, defined as restoration of normal carbohydrate tolerance without other treatment. Partial remission, defined as good metabolic control (hemoglobin A_1c ≤7.9%, preprandial blood glucose ≤8 mM with an insulin dose of <0.5 U. kg⁻¹ · day¹), occurred in 10 placebo (40%) and 7 azathioprine (29%) patients at 6 mo and in 4 placebo (16%) and 4 azathioprine (17%) patients at 12 mo (differences not significant). Fasting plasma C-peptide was significantly greater in the azathioprine-treated group at 3 and 6 mo, but this difference was not sustained. C-peptide responses to a standard meal and the frequency of islet cell and insulin antibodies did not differ between the two groups over the 12-mo period. Azathioprine caused no significant side effects. We conclude that in the dosage used, and despite early effects on endogenous insulin secretion, azathioprine alone does not influence the remission phase in children with newly diagnosed type I diabetes.