IL-12 administration to nonobese diabetic (NOD) mice induces IFN-γ-secreting type 1 T cells and high circulating IFN-γ levels and accelerates insulin-dependent diabetes mellitus (IDDM). Here we show that IL-12-induced IFN-γ production is dispensable for diabetes acceleration, because exogenous IL-12 could enhance IDDM development in IFN-γ-deficient as well as in IFN-γ-sufficient NOD mice. Both in IFN-γ+/− and IFN-γ−/− NOD mice, IL-12 administration generates a massive and destructive insulitis characterized by T cells, macrophages, and CD11c+ dendritic cells, and increases the number of pancreatic CD4+ cells secreting IL-2 and TNF-α. Surprisingly, IL-12-induced IFN-γ hinders pancreatic B cell infiltration and inhibits the capacity of APCs to activate T cells. Although pancreatic CD4+ T cells from IL-12-treated IFN-γ−/− mice fail to up-regulate the P-selectin ligand, suggesting that their entry into the pancreas may be impaired, T cell expansion is favored in these mice compared with IL-12-treated IFN-γ+/− mice because IL-12 administration in the absence of IFN-γ leads to enhanced cell proliferation and reduced T cell apoptosis. NO, an effector molecule in β cell destruction, is produced ex vivo in high quantity by pancreas-infiltrating cells through a mechanism involving IL-12-induced IFN-γ. Conversely, in IL-12-treated IFN-γ-deficient mice, other pathways of β cell death appear to be increased, as indicated by the up-regulated expression of Fas ligand on Th1 cells in the absence of IFN-γ. These data demonstrate that IFN-γ has a dual role, pathogenic and protective, in IDDM development, and its deletion allows IL-12 to establish alternative pathways leading to diabetes acceleration.