Type 1 diabetes (T1D) is an autoimmune disease resulting from the complex interaction between multiple susceptibility genes, environmental factors and the immune system. Over 40 T1D susceptibility regions have been suggested by recent genome-wide association studies; however, the specific genes and their role in the disease remain elusive. The objective of this study is to identify the susceptibility gene(s) in the 12q13 region and investigate the functional link to the disease pathogenesis. A total of 19 SNPs in the 12q13 region were analyzed by the TaqMan assay for 1,434 T1D patients and 1,865 controls. Thirteen of the SNPs are associated with T1D (best p = 4×10−11), thus providing confirmatory evidence for at least one susceptibility gene in this region. To identify candidate genes, expression of six genes in the region was analyzed by real-time RT-PCR for PBMCs from 192 T1D patients and 192 controls. SNP genotypes in the 12q13 region are the main factors that determine ERBB3 mRNA levels in PBMCs. The protective genotypes for T1D are associated with higher ERBB3 mRNA level (p<10−10). Furthermore, ERBB3 protein is expressed on the surface of CD11c+ cells (dendritic cells and monocytes) in peripheral blood after stimulation with LPS, polyI:C or CpG. Subjects with protective genotypes have significantly higher percentages of ERBB3+ monocytes and dendritic cells (p = 1.1×10−9); and the percentages of ERBB3+ cells positively correlate with the ability of APC to stimulate T cell proliferation (R2 = 0.90, p<0.0001). Our results indicate that ERBB3 plays a critical role in determining APC function and potentially T1D pathogenesis.