Diabetes is a major risk factor for cardiovascular disease. To examine how diabetes interacts with a mildly compromised lipid metabolism, we introduced the diabetogenic Ins2(C96Y/+) (Akita) mutation into mice expressing human apoE4 (E4) combined with either an overexpressing human LDL receptor gene (hLDLR) or the wild-type mouse gene. The hLDLR allele caused 2-fold reductions in plasma HDL-cholesterol, plasma apoA1, and hepatic triglyceride secretion. Diabetes increased plasma total cholesterol 1.3-fold and increased apoB48 secretion 3-fold, while reducing triglyceride secretion 2-fold. Consequently, diabetic E4 mice with hLDLR secrete increased numbers of small, cholesterol-enriched, apoB48-containing VLDL, although they have near normal plasma cholesterol (<120 mg/dl). Small foam cell lesions were present in the aortic roots of all diabetic E4 mice with hLDLR that we analyzed at six months of age. None were present in nondiabetic mice or in diabetic mice without hLDLR. Aortic expression of genes affecting leukocyte recruitment and adhesion was enhanced by diabetes. ApoA1 levels, but not diabetes, were strongly correlated with the ability of plasma to efflux cholesterol from macrophages. We conclude that the diabetes-induced proinflammatory changes in the vasculature and the hLDLR-mediated cholesterol accumulation in macrophages synergistically trigger atherosclerosis in mice with human apoE4, although neither alone is sufficient.