Type 1 diabetes mellitus is associated with cognitive changes, but the extent of cognition decline depends on age at onset, duration of diabetes, and occurrence of attacks of hypoglycemia or ketoacidosis. This study was designed to assess cognitive function in a group of children with type 1 diabetes mellitus. A total of 40 diabetic children were recruited from the pediatric department of Assiut University Hospital, Egypt. Forty healthy children matched for age, sex, and socioeconomic status were chosen as controls for comparison. Cognition was assessed using Stanford-Binet and event-related potentials tests. Compared to the control group, patients reported a significant reduction in intelligent quotient, comprehension, abstract visual reasoning, quantitative reasoning, bead memory, and total short memory testing for cognitive functions. Prolonged N1, P200, N2, and P300 latencies and reduced P300-N2 amplitude were reported. Significant negative correlations were identified in most studied cognitive functions and ketoacidosis or family history of diabetes mellitus.