A 14 year male adolescent born of 2nd degree consanguineous marriage presented with asymptomatic proteinuria and severe anemia. He had leucopenia, anisopoikilocytosis, megaloblastic erythropoiesis, megakaryocytes with low serum B12 level. His younger sibling was similarly affected. This combination suggested Imerslund-Grasbeck syndrome. The hemoglobin levels improved with injection of vitamin B12 but proteinuria persisted. During follow-up, he developed ketoacidosis due to insulin dependent diabetes mellitus. This rare combination has not been reported in the Indian literature.