β-Amyloid (Aβ) deposition has a central role in the pathogenesis of Alzheimer disease (AD). Previous studies have indicated that as a risk factor for AD, diabetes mellitus (DM) could induce Aβ deposition in the brain, but the mechanism is not fully elucidated. Autophagy-lysosome is a cellular pathway involved in protein and organelle degradation. In the present study, we used streptozotocin (STZ)-induced diabetic rats to investigate whether autophagy-lysosome is related to Aβ1-42 clearance in DM. We found that DM rats had a longer escape latency and less frequent entry into the target zone than that of the control group (p < 0.05) in the Morris water maze test. Meanwhile, hippocampal neuron damage and apoptosis (p < 0.05) were found in the DM rats. The Aβ1-42 expression in the hippocampus significantly increased in the DM group compared with the control group (p < 0.05). The markers of autophagy, beclin-1 and LC3 II, were increased (p < 0.05), whereas LC3 I was decreased (p < 0.05), and the ratio of LC3 II / I was increased as the time advanced (p < 0.01). LAMP1 and LAMP2, which are the markers of lysosome function, were decreased in the hippocampus of DM rats (p < 0.05). The Aβ1-42 deposition was correlated with beclin-1, LC3 II, and LC3 I positively (p < 0.05), but with LAMP1 and LAMP2 negatively (p < 0.05). These findings indicate that DM activated autophagy, but lysosome function was impaired. Autophagy-lysosome dysfunction may be involved in the Aβ deposition in diabetic cognitive impairment.