OBJECTIVE - Influenza vaccine uptake remains low among the high-risk group of patients with diabetes, partly because of conflicting evidence regarding its potential benefits. We assessed the clinical effectiveness of influenza vaccination in adults with diabetes and specifically examined potential modification of effect by age and prior influenza vaccine uptake. RESEARCH DESIGN AND METHODS - The study was part of the Prevention of Influenza, Surveillance and Management (PRISMA) study, a nested case-control study conducted during the 1999-2000 influenza A epidemic, among 75,235 patients from primary care of any age recommended for vaccination. Among 9,238 adult patients with diabetes, 131 cases arose who were either hospitalized for diabetes dysregulation, acute respiratory disease, or cardiovascular disease and 61 cases who died, and we compared them with 1,561 control subjects. We evaluated the effect of (prior) influenza vaccination by means of logistic regression analysis controlling for age, sex, health insurance coverage, prior health care use, medication use, and comorbid conditions. RESULTS - Vaccination was associated with a 56% reduction in any complication (95% CI 36-70%), a 54% reduction in hospitalizations (26-71%), and 58% reduction in deaths (13-80%). Among study subjects aged 18-64 years, we observed somewhat higher reductions in the occurrence of any complication than among those aged >65 years (72 vs. 39%). In first-time vaccinated subjects, the primary end point was reduced by 47% (0.2-72%), and in those who received vaccination in the year before, the reduction was 58% (4-81%). CONCLUSIONS - Adults with type 2 diabetes, like other individuals from recognized risk groups, benefit considerably from influenza vaccination, and no difference in vaccine effectiveness was observed between first-time and repeat vaccination.