OBJECTIVES: To estimate the annual medical costs attributable to obesity in diabetic patients. METHODS: This cross-sectional analysis was based on the 2001-2005 Medical Expenditure Panel Survey data, a nationally representative sample of the U.S. non-institutionalized population.  A total of 4880 diabetic patients were identified based on the ICD-9-CM code:250 after excluding patients with pregnancy, malignancy, kidney dialysis, immunodeficiency, or >75years old. Diabetic patients were classified as normal (body mass index(BMI):18.5-<25), overweight(BMI:25-<30), or obese(BMI:≥30). Medical costs included costs associated with any treatments except dental problems and injuries. The parameters for obese patients were estimated using a generalized linear model with a log link function and a gamma distribution after adjusting for the demographic variables.  The mean medical cost was predicted for normal-weight patients using the parameters estimated from the obese patients.  The difference between the predicted and the observed costs in normal weight patients was the medical costs attributable to obesity.  All costs were converted to 2005 U.S. dollars using price indices.  Data were analyzed using SAS and SUDAAN. RESULTS: The age-adjusted prevalence of the study diabetic patients was 2.1% in normal-weight, 3.9% in overweight, and 9.7% in obese patients respectively.  The average attributable costs to obesity in diabetic patients were $1,527 (95%CI:$318-$2736).  The average attributable costs to obesity increased as patients became older ($794 for aged 18-50, $1636 for aged 51-64, and $2044 for aged 65-74) and were higher in women ($2679) than men ($139), and in private insurance ($2185) compared to public insurance ($591). CONCLUSIONS: The prevalence of diabetes in obese people was approximately five times higher than in normal-weight people.  The medical costs for obese patients with diabetes were significantly higher than in normal weight patients.  The effective public health intervention aimed at controlling weight in diabetic patients is recommended to reduce the extra economic burden of obesity.