Patients with diabetes develop endothelial dysfunction shortly after diabetes onset that progresses to vascular disease underlying the majority of diabetes-associated comorbidities. Increased lipid peroxidation, mitochondrial calcium overload, and mitochondrial dysfunction are characteristics of dysfunctional endothelial cells in diabetic patients. We here identified that targeting the lipid peroxidation product 12(S)-hydroxyeicosatetraenoic acid–induced [12(S)-HETE–induced] activation of the intracellularly located cation channel transient receptor potential vanilloid 1 (TRPV1) in endothelial cells is a means to causally control early-stage vascular disease in type I diabetic mice. Mice with an inducible, endothelium-specific 12/15-lipoxygenase (12/15Lo) knockout were protected similarly to TRPV1-knockout mice from type 1 diabetes–induced endothelial dysfunction and impaired vascular regeneration following arterial injury. Both 12(S)-HETE in concentrations found in diabetic patients and TRPV1 agonists triggered mitochondrial calcium influx and mitochondrial dysfunction in endothelial cells, and 12(S)-HETE effects were absent in endothelial cells from TRPV1-knockout mice. As a therapeutic consequence, we found that a peptide targeting 12(S)-HETE–induced TRPV1 interaction at the TRPV1 TRP box ameliorated diabetes-induced endothelial dysfunction and augmented vascular regeneration in diabetic mice. Our findings suggest that pharmacological targeting of increased endothelial lipid peroxidation can attenuate diabetes-induced comorbidities related to vascular disease.