Diabetes-associated oxidative stress is clearly manifest in peripheral nerve, dorsal root, and sympathetic ganglia of the peripheral nervous system and endothelial cells and is implicated in nerve blood flow and conduction deficits, impaired neurotrophic support, changes in signal transduction and metabolism, and morphological abnormalities characteristic of peripheral diabetic neuropathy (diabetic peripheral neuropathy). Hyperglycemia has a key role in oxidative stress in diabetic nerve, whereas the contribution of other factors, such as endoneurial hypoxia, transition metal imbalance, and hyperlipidemia, has not been rigorously proven. It has been suggested that oxidative stress, particularly mitochondrial superoxide production, is responsible for sorbitol pathway hyperactivity, nonenzymatic glycation/glycooxidation, and activation of protein kinase C. However, this concept is not supported by in vivo studies demonstrating the lack of any inhibition of the sorbitol pathway activity in peripheral nerve, retina, and lens by antioxidants, including potent superoxide scavengers. Its has been also hypothesized that aldose reductase (AR) detoxifies lipid peroxidation products, and therefore, the enzyme inhibition in diabetes is detrimental rather than benefical. However, the role for AR in lipid peroxdation product metabolism has never been demonstrated in vivo, and the effects of aldose reductase inhibitors and antioxidants on diabetic peripheral neuropathy are unidirectional, i.e., both classes of agents prevent and correct functional, metabolic, neurotrophic, and morphological changes in diabetic nerve. Growing evidence indicates that AR has a key role in oxidative stress in the peripheral nerve and contributes to superoxide production by the vascular endothelium. The potential mechanisms of this phenonmenon are discussed.