The effect of cigarette smoking on diabetic renal and retinal complications was evaluated in 359 young subjects with insulin-dependent diabetes mellitus. The prevalence of increased albumin excretion rates was 2.8 times higher in smokers than nonsmokers. Mean glycohemoglobin levels and duration of diabetes were also significant factors in the development of diabetic nephropathy and retinopathy in a logistic regression model. Smoking remained a significant factor in the logistic regression model for albuminuria (but not retinopathy) when controlled for glycohemoglobin level, duration of diabetes, age, gender, and blood pressure. The progression of albuminuria and of retinopathy was also greater in smokers. Albuminuria improved significantly when subjects ceased smoking. It is concluded that cigarette smoking is an independent risk factor and is associated with the development and progression of early diabetic renal damage (albuminuria) and with the worsening of retinal disease in young subjects with diabetes.