Peptide loading of MHC class II (MHCII) molecules is facilitated by HLA-DM (DM), which catalyzes CLIP release, stabilizes empty MHCII, and edits the MHCII-bound peptide repertoire. HLA-DO (DO) binds to DM and modulates its activity, resulting in an altered set of peptides presented at the cell surface. MHCII–peptide presentation in individuals with type 1 diabetes (T1D) is abnormal, leading to a breakdown in tolerance; however, no direct measurement of the MHCII pathway activity in T1D patients has been performed. In this study, we measured MHCII Ag-processing pathway activity in humans by determining MHCII, MHCII–CLIP, DM, and DO levels by flow cytometry for peripheral blood B cells, dendritic cells, and monocytes from 99 T1D patients and 97 controls. Results showed that MHCII levels were similar for all three APC subsets. In contrast, MHCII–CLIP levels, independent of sex, age at blood draw, disease duration, and diagnosis age, were significantly increased for all three APCs, with B cells showing the largest increase (3.4-fold). DM and DO levels, which usually directly correlate with MHCII–CLIP levels, were unexpectedly identical in T1D patients and controls. Gene expression profiling on PBMC RNA showed that DMB mRNA was significantly elevated in T1D patients with residual C-peptide. This resulted in higher levels of DM protein in B cells and dendritic cells. DO levels were also increased, suggesting that the MHCII pathway maybe differentially regulated in individuals with residual C-peptide. Collectively, these studies show a dysregulation of the MHCII Ag-processing pathway in patients with T1D.