Disseminated sporotrichosis is a rare presentation of this mycosis. Although it has been described in immunocompetent individuals, there is often T cell-mediated immune compromise. We report the case of a woman with uncontrolled Type 2 diabetes who developed disseminated cutaneous sporotrichosis. The course of the disease presented several complications including hepatitis secondary to itraconazole and knee arthritis with culture positive for Sporothrix schenckii during treatment with saturated solution of potassium iodide. The case discussion includes aspects of the pathogenesis of disseminated sporotrichosis and management of the infection and its complications.