Objectives To examine sleep and behavior problems in children with type 1 Diabetes Mellitus (T1DM) compared to nondiabetic controls in a bridging country between east and west and to evaluate the interaction of sleep on behavior problems, maternal sleep, and maternal depressive symptoms. Methods The study included children with T1DM (4–12 years old) and age/sex-matched healthy controls. Parents completed the Children Sleep Habits Questionnaire (CSHQ), Children Behavior Checklist/4–18 (CBCL/4–18), Pittsburgh Sleep Quality Index (PSQI), Beck Depression Inventory (BDI), and a study-specific sociodemographic questionnaire. Clinical parameters regarding T1DM were collated from medical records. Results Participants included 75 children with T1DM and 49 controls. Based on CSHQ results 65.3% of all participants in both groups had sleep problems. Children with T1DM slept less and had higher daytime sleepiness problems than controls (p=0.024, p=0.008, respectively). No association was found between CSHQ or sleep duration and mode of diabetes treatment (pump, multiple daily injections) or glycemic control. CSHQ correlated with maternal PSQI (r=0.336 p=0.004) and BDI (r=0.341 p=0.004) in children with T1DM, but there was no association amongst controls. Children with T1DM had higher internalizing problems compared to controls. CSHQ and BDI correlated with internalizing, externalizing, and the total scores of the CBCL/4–18 in children with T1DM (R 2 =0.260 p<0.001; R 2 =0.207 p<0.001, R 2 =0.381 p<0.001 respectively). In controls, only BDI was associated with internalizing, externalizing, and the total scores of the CBCL/4–18. Conclusions Children with T1DM should be evaluated for sleep pattern and quality at follow-up, to identify those at risk for behavior problems and improve maternal life quality. Large longitudinal studies are necessary to assess the effect of new diabetes treatment modalities on sleep.