Activation of inflammatory processes may contribute to the development of type 2 diabetes mellitus. In addition, inflammation appears to be a major mechanism responsible for vascular damage leading to the clinically well-recognized complications of diabetes. Inflammatory cytokine and chemokine mediators released from visceral fat contribute to atherosclerotic plaque formation and increased risk for myocardial infarction and stroke. Activation of growth factors and adhesion molecules may promote the movement of inflammatory cells into the renal microvasculature, predisposing to the development of diabetic nephropathy. Emerging evidence also indicates that markers of inflammation are associated with the more severe forms of diabetic retinopathy. Future approaches to the treatment of diabetic complications may involve regulation of inflammatory processes, specifically targeting factors that contribute to vascular damage.