Chronic hyperglycemia is known to disrupt the proteolytic milieu, initiating compensatory and maladaptive pathways in the diabetic kidney. Such changes in intrarenal proteolysis are captured by the urinary peptidome. To elucidate the early kidney response to chronic hyperglycemia, we conducted a peptidomic investigation into urines from otherwise healthy youths with type 1 diabetes and their non-diabetic peers using unbiased and targeted mass spectrometry-based techniques. This cross-sectional study included two separate cohorts for the discovery (n = 30) and internal validation (n = 30) of differential peptide excretion. Peptide bioactivity was predicted using PeptideRanker and subsequently verified in vitro Proteasix and the Nephroseq database were used to identify putative proteases responsible for peptide generation and examine their expression in diabetic nephropathy. A total of 6550 urinary peptides were identified in the discovery analysis. We further examined the subset of 162 peptides, which were quantified across all thirty samples. Of the 15 differentially excreted peptides (p < 0.05), seven derived from a C-terminal region (589SGSVIDQSRVLNLGPITRK607) of uromodulin, a kidney-specific protein. Increased excretion of five uromodulin peptides was replicated in the validation cohort using parallel reaction monitoring (p < 0.05). One of the validated peptides (SGSVIDQSRVLNLGPI) activated NFκB and AP-1 signaling, stimulated cytokine release, and enhanced neutrophil migration in vitro. In silico analyses highlighted several potential proteases such as hepsin, meprin A, and cathepsin B to be responsible for generating these peptides. In summary, we identified a urinary signature of uromodulin peptides associated with early type 1 diabetes before clinical manifestations of kidney disease and discovered novel bioactivity of uromodulin peptides in vitro Our present findings lay the groundwork for future studies to validate peptide excretion in larger and broader populations, to investigate the role of bioactive uromodulin peptides in high glucose conditions, and to examine proteases that cleave uromodulin.