In many populations, the peak period of incidence of type 1 diabetes (T1D) has been observed to be around 10–14 years of age, coinciding with puberty, but direct evidence of the role of puberty in the development of T1D is limited. We therefore aimed to investigate whether puberty and the timing of its onset are associated with the development of islet autoimmunity (IA) and subsequent progression to T1D. A Finnish population-based cohort of children with HLA-DQB1-conferred susceptibility to T1D was followed from 7 years of age until 15 years of age or until a diagnosis of T1D (n = 6920). T1D-associated autoantibodies and growth were measured at 3- to 12-month intervals, and pubertal onset timing was assessed based on growth. The analyses used a three-state survival model. IA was defined as being either positive for islet cell antibodies plus at least one biochemical autoantibody (ICA + 1) or as being repeatedly positive for at least one biochemical autoantibody (BC1). Depending on the IA definition, either 303 (4.4%, ICA + 1) or 435 (6.3%, BC1) children tested positive for IA by the age of 7 years, and 211 (3.2%, ICA + 1)) or 198 (5.3%, BC1) developed IA during follow-up. A total of 172 (2.5%) individuals developed T1D during follow-up, of whom 169 were positive for IA prior to the clinical diagnosis. Puberty was associated with an increase in the risk of progression to T1D, but only from ICA + 1-defined IA (hazard ratio 1.57; 95% confidence interval 1.14, 2.16), and the timing of pubertal onset did not affect the association. No association between puberty and the risk of IA was detected. In conclusion, puberty may affect the risk of progression but is not a risk factor for IA.