Epigenetic mechanisms are integral to pancreatic β cell function. Promoter hypermethylation of the helicase like-transcription factor (HLTF) gene-a component of the cellular DNA damage response that contributes to genome stability-has been implicated in age-associated changes in β cells. To study HLTF, we generated global and β cell-specific (β) Hltf knockout (KO) immune competent (IC) and immune deficient (ID) Rag2-/IL2- mice. IC global and β Hltf KO mice were neonatal lethal whereas ID global and β Hltf KO newborn mice had normal survival. This focused our investigation on the effects of Rag2 interruption with common gamma chain interruption on β cell function/survival. Three-way transcriptomic (RNAseq) analyses of whole pancreata from IC and ID newborn β Hltf KO and wild type (Hltf +/+) controls combined with spatially resolved transcriptomic analysis of formalin fixed paraffin embedded tissue, immunohistochemistry and laser scanning confocal microscopy showed DNA damage caused by β Hltf KO in IC mice upregulated the Hmgb1-Rage axis and a gene signature for innate immune cells. Perforin-delivered granzyme A (GzmA) activation of DNase, Nme1, showed damaged nuclear single-stranded DNA (γH2AX immunostaining). This caspase-independent method of cell death was supported by transcriptional downregulation of Serpinc1 gene that encodes a serine protease inhibitor of GzmA. Increased transcriptional availability of complement receptors C3ar1 and C5ar1 likely invited crosstalk with Hmgb1 to amplify inflammation. This study explores the complex dialog between β cells and immune cells during development. It has implications for the initiation of type I diabetes in utero when altered gene expression that compromises genome stability invokes a localized inflammatory response.