Type 1 diabetes is associated with increased intestinal inflammation and decreased abundance of butyrate-producing bacteria. We investigated the effect of butyrate on inflammation, kidney parameters, HbA1c, serum metabolites and gastrointestinal symptoms in persons with type 1 diabetes, albuminuria and intestinal inflammation. We conducted a randomized placebo-controlled, double-blind, parallel clinical study involving 53 participants randomized to 3.6 g sodium butyrate daily or placebo for 12 weeks. The primary endpoint was the change in fecal calprotectin. Additional endpoints were the change in fecal short chain fatty acids, intestinal alkaline phosphatase activity and immunoglobulins, serum lipopolysaccharide, CRP, albuminuria, kidney function, HbA1c, metabolites and gastrointestinal symptoms. The mean age was 54 ± 13 years, and the median [Q1:Q3] urinary albumin excretion was 46 [14:121] mg/g. The median fecal calprotectin in the butyrate group was 48 [26:100] μg/g at baseline, and the change was −1.0 [−20:10] μg/g; the median in the placebo group was 61 [25:139] μg/g at baseline, and the change was −12 [−95:1] μg/g. The difference between the groups was not significant (p = 0.24); neither did we find an effect of butyrate compared to placebo on the other inflammatory markers, kidney parameters, HbA1c, metabolites nor gastrointestinal symptoms. Twelve weeks of butyrate supplementation did not reduce intestinal inflammation in persons with type 1 diabetes, albuminuria and intestinal inflammation.