This study is a double-blind, randomized, placebo-controlled, parallel design trial enrolling 80 patients (2x40) with Type 1 diabetes and microalbuminuria. Patients will be randomized to either 200 mg Alagebrium twice daily or placebo for a period of 24 weeks after an 8 week run-in period. There will be a 8 week run-out period. All patients will receive ramipril during the entire study period. Efficacy measurements will be performed at baseline, at 12 weeks and at the end of the study. Measurements for albumin:creatinine ratio(mg/g), plasma renin level, collagen markers, AGE related markers and 24 hour blood pressure measurements will also be determined. A total of 9 visits will be performed during the entire study.