Oedema is an uncommon complication of insulin therapy, which has only rarely been reported in childhood. We describe a case of a 12-year-old girl with newly diagnosed type 1 diabetes, who presented with oedema of the lower extremities and periorbitally, one day after the initiation of insulin treatment. Other causes of oedema were excluded. Following administration of frusemide, oedema resolved within ten days. An extended review of the literature revealed only nine cases of insulin-induced oedema in children and adolescents aged </=16 years. In conclusion, insulin-induced oedema should be considered during the introduction of insulin therapy in children and adolescents with newly diagnosed type 1 diabetes. Loop diuretics and ephedrine may be beneficial when spontaneous resolution does not occur.