Type 1 diabetes mellitus (T1DM) is associated with low bone mass and a higher risk for fractures. Dickkopf-1 (Dkk1), which inhibits Wnt signaling, osteoblast function, and bone formation, has been found to be increased in the serum of patients with T1DM. Here, we investigated the functional role of Dkk1 in T1DM-induced bone loss in mice. T1DM was induced in 10-week-old male mice with Dkk1-deficiency in late osteoblasts/osteocytes (Dkk1f/f;Dmp1-Cre, cKO) and littermate control mice by 5 subsequent injections of streptozotocin (40 mg/kg). Age-matched, non-diabetic control groups received citrate buffer instead. At week 12, calvarial defects were created in subgroups of each cohort. After a total of 16 weeks, weight, fat, the femoral bone phenotype and the area of the bone defect were analyzed using µCT and dynamic histomorphometry. During the experiment, diabetic WT and cKO mice did not gain body weight compared to control mice. Further they lost their perigonadal and subcutaneous fat pads. Diabetic mice had highly elevated serum glucose levels and impaired glucose tolerance, regardless of their Dkk1 levels. T1DM led to a 36% decrease in trabecular bone volume in Cre− negative control animals, whereas Dkk1 cKO mice only lost 16%. Of note, Dkk1 cKO mice were completely protected from T1DM-induced cortical bone loss. T1DM suppressed the bone formation rate, the number of osteoblasts at trabecular bone, serum levels of P1NP and bone defect healing in both, Dkk1-deficient and sufficient, mice. This may be explained by increased serum sclerostin levels in both genotypes and the strict dependence on bone formation for bone defect healing. In contrast, the number of osteoclasts and TRACP 5b serum levels only increased in diabetic control mice, but not in Dkk1 cKO mice. In summary, Dkk1 derived from osteogenic cells does not influence the development of T1DM but plays a crucial role in T1DM-induced bone loss in male mice by regulating osteoclast numbers.