Type 1 diabetes (T1D) with its worldwide increasing incidence is one of the most serious chronic conditions of adolescence. This study aimed to assess the Palestinian adolescent diabetic patients' health-related quality of life (HRQOL) and to identify specific factors that could predict poor quality of life. We also aimed to compare adolescents' reported HRQOL to proxy reports by their parents. A cross-sectional study was carried out between November 2022 and October 2023 in the six governorates of northern West Bank/Palestine: Jenin, Nablus, Qalqilya, Salfit, Tubas, and Tulkarm. Patients who were diagnosed with T1D for over 6 months from their recruitment, aged between 10 and 18 years, were recruited from diabetes clinics of the Ministry of Health (MOH) and the Palestine Diabetes Institute (PDI). One hundred seventy adolescents and 170 parents (or guardians) completed the Pediatric Quality of Life Inventory (Peds QL) 3.2 Diabetes Module for adolescents and parents, respectively. An acceptable mean of 70.6 for the total score was reported for the Peds QL 3.2 Diabetes Module. Better scores were reported for the diabetes management summary score compared to the diabetes symptom summary score. Worry and communication were the lowest and highest reported subscores, respectively. Parents reported significantly lower results than adolescents. Income, gender, and hemoglobin A1c (HbA1c) were the main predictors of HRQOL among adolescents with T1D in Palestine. Future national health strategies should consider income differences and try to overcome health gaps among adolescents with T1D coming from low-income families. Future research is needed to explore the political and cultural aspects and their effects on HRQOL among diabetic adolescents in Palestine.