Diabetes is one of the most prevalent non-communicable disease globally and it is one of the leading cause for death in most developed countries. The current population-based study aim was to describe to the epidemiology of diabetes in Israel by using our HMO's automated medical databases. All diabetic patients appearing in the diabetes registry among 1.6 million insured members in the second largest HMO in Israel were selected for epidemiological analysis. We identified 39,768 diabetic patients (crude prevalence rate of 2.6%). Higher age-specific prevalence rates were recorded among males. The highest age-specific prevalence rate of diabetes was calculated for men aged 75 and above (18.1%). A rise in the prevalence and mortality rates was recorded between 1999 and 2001 female (from 1.9 to 2.8 per 100,000) and for men (from 2.3 to 3.8 per 100,000). The current study demonstrates the potential of using large automated medical and administrative databases to determine the epidemiology of chronic disease, such as diabetes. The rise in the prevalence and mortality of diabetes patients has important implication for Israeli health authorities and should be seriously regarded.