Endothelial dysfunction plays a key role in the pathogenesis of diabetic vascular disease. The endothelium controls the tone of the underlying vascular smooth muscle through the production of vasodilator mediators. The endothelium-derived relaxing factors (EDRF) comprise nitric oxide (NO), prostacyclin, and a still elusive endothelium-derived hyperpolarizing factor (EDHF). Impaired endothelium-dependent vasodilation has been demonstrated in various vascular beds of different animal models of diabetes and in humans with type 1 and 2 diabetes. Several mechanisms of endothelial dysfunction have been reported, including impaired signal transduction or substrate availibility, impaired release of EDRF, increased destruction of EDRF, enhanced release of endothelium-derived constricting factors and decreased sensitivity of the vascular smooth muscle to EDRF. The principal mediators of hyperglycaemia-induced endothelial dysfunction may be activation of protein kinase C, increased activity of the polyol pathway, non-enzymatic glycation and oxidative stress. Correction of these pathways, as well as administration of ACE inhibitors and folate, has been shown to improve endothelium-dependent vasodilation in diabetes. Since the mechanisms of endothelial dysfunction appear to differ according to the diabetic model and the vascular bed under study, it is important to select clinically relevant models for future research of endothelial dysfunction.