The aim of this study was to evaluate nerve regeneration in relation to the transcription factor, Activating Transcription Factor 3 (ATF 3), and an apoptotic marker, caspase 3, in the Schwann cells of diabetic BB rats (i.e. display type 1 diabetes phenotype). Sciatic nerves in healthy Wistar rats and in diabetic BB rats were transected and immediately repaired. Axonal outgrowth (neurofilament staining) and expression of ATF 3 and caspase 3 were quantified by immunohistochemistry after six days. There was no difference in axonal outgrowth between healthy and diabetic rats. However, the sciatic nerve in the diabetic rats exhibited a larger number of ATF 3 expressing Schwann cells at the site of the lesion and also a higher number of caspase 3 expressing Schwann cells. Similar differences were observed in the distal nerve segment between the healthy and diabetic rats. There were no correlations between the number of Schwann cells expressing ATF 3 and caspase 3. Thus, diabetic BB rats display an increased activation of ATF 3 and also a rise in apoptotic caspase 3 expressing Schwann cells, but with no discrepancy in length of axonal outgrowth after nerve injury and repair at six days. Knowledge about signal transduction mechanisms in diabetes after stress may provide new insights into the development of diabetic neuropathy and neuropathic pain.