Insulin-specific B lymphocytes play an important role in development of autoimmunity in Type 1 Diabetes (T1D). Since potentially offensive autoreactive cells are silenced by mechanisms of immune tolerance, participation of insulin-binding B cells (IBCs) in T1D must reflect escape from this silencing. Examining this question, we found that those IBCs bearing antigen receptors with high affinity for insulin occur only in the anergic BND (naive IgD(+)IgM(-) B cells [Duty, et.al. 2009 J Exp Med. 16: 139-51]) B cell compartment in peripheral blood of healthy subjects. Importantly, these cells are absent from this compartment in some “at risk” first degree relatives and all pre-diabetic and new-onset (<1yr) T1D patients. BND cells were found at normal levels in individuals diabetic for >1 year. Interestingly, these changes were associated with loss of the entire BND compartment. By extrapolation from parallel studies of in diabetic NOD mice, we believe that under these circumstances B cells relocalize in tissues rich in their autoantigen, where they become activated and can present antigen to T cells. These findings suggest that environmental events such as infection or injury may, by disrupting B cell anergy, dispose individuals to autoimmunity, the precise tissue target of which is specified by genetic risk factors.