Recent studies have proposed a role for a reduced number of circulating monocytes in the development of atherosclerosis and circulatory diseases in diabetes. Ketosis is frequently encountered in type-I diabetics. This study was undertaken to test the hypothesis that hyperketonemia can lower blood monocyte count in type-I diabetic patients. Blood monocyte count was significantly lower (p < 0.05) in diabetics (n = 27) compared with age-matched normal siblings (n = 22). Blood levels of acetoacetate (AA) and triglycerides were significantly higher in diabetics compared with normals. To examine whether hyperketonemia can directly alter the monocyte count in diabetics, we studied the effect of ketone bodies AA and beta-hydroxybutyrate (BHB) on U937 cells, a human-derived promonocytic cell line as an in vitro model. The cell culture studies showed a dose-dependent growth inhibition and induction of apoptosis as a result of treatment with AA in U937 cells. Furthermore, there was a significant decrease in GSH and increase in lipid peroxidation products in AA-treated U937 cells. Taken together, this study suggests that elevated levels of ketone body AA can result in oxidative damage, accelerated apoptosis, and inhibition of cell growth in monocytes, which in turn can lower monocyte count in the blood of type-I diabetic patients.