Aims/hypothesis We determined the longitudinal relationship between adiponectin levels and the development of microalbuminuria in an inception cohort of children with type 1 diabetes. Methods Blood samples collected annually over a median of 9.0 (range 1.3-14.9) years were assayed for adiponectin and HbA 1c in 55 children (36 girls) with type 1 diabetes and microalbuminuria whose age of onset of diabetes was 9.4 years (range 2.2-15.4). Samples were also assayed from normoalbuminuric children (controls) matched for age, sex and duration of diabetes. Results Overall, adiponectin levels were higher in girls than in boys, but only after 11 years of age (median [range]: 15.3 [5.8-124.4] vs 11.6 [4.1-26.5] mg/l, p<0.001). Furthermore, adiponectin levels were higher in girls with microalbuminuria than in control girls, but this was only apparent after the onset of microalbuminuria (p=0.001, adjusted for BMI, daily insulin dose, HbA 1c and age). In boys, adiponectin levels did not differ between those with microalbuminuria and controls. Further sex-related discordant associations with adiponectin levels were observed; in girls, adiponectin levels were positively related to HbA 1c levels (r=0.2, p=0.05) and urine albumin excretion (r=0.3, p<0.05) and inversely related to BMI (r=−0.2, p<0.05). These associations were absent in boys. Conclusions/interpretation In adolescent girls with type 1 diabetes but not in boys, adiponectin levels increase with increasing urine albumin excretion and onset of microalbuminuria. Although causal links cannot be inferred, this sexual dimorphism may reflect interactive effects of hyperglycaemia and sex steroids on risk of complications and adiponectin production.