In type 1 diabetes (T1D), a break in central and peripheral tolerance results in antigen-specific T cells destroying insulin-producing, pancreatic beta cells. Herein, we discuss the critical sub-population of dendritic cells responsible for mediating both the cross-presentation of islet antigen to CD8(+) T cells and the direct presentation of beta cell antigen to CD4(+) T cells. These cells, termed merocytic dendritic cells (mcDC), are more numerous in non-obese diabetic (NOD), and antigen-loaded mcDC rescue CD8(+) T cells from peripheral anergy and deletion, and stimulate islet-reactive CD4(+) T cells. When purified from the pancreatic lymph nodes of overtly diabetic NOD mice, mcDC can break peripheral T cell tolerance to beta cell antigens in vivo and induce rapid onset T cell-mediated T1D in young NOD mouse. Thus, the mcDC subset appears to represent the long-sought critical antigen-presenting cell responsible for breaking peripheral tolerance to beta cell antigen in vivo.