OBJECTIVES: Diabetes mellitus (DM) is a major health problem with severe complications and a significant impact on quality of life. It constitutes an enormous burden of disease due to high prevalence, severe co-morbidities and high costs for society. This study is the first comprehensive study on direct and indirect cost of DM (type 1 and type 2) and its complications in Poland.  METHODS: In order to estimate the direct medical costs of DM and its complications, including the costs of medical consultation, hospitalization, rehabilitation, drugs and medical equipment data for the years 2004-2009 of the National Health Fund were used. Indirect costs like costs of pensions for incapacity for work, the costs of rehabilitation and loss of productivity due to diabetes and its complications were obtained from the Department of Social Security for the years 2004-2009. RESULTS: Direct medical costs of DM in Poland increased in the analysed period. The significant share of these costs constitutes the costs of drugs (25.7% increase 2005 vs. 2007). Direct costs of DM treatment, without costs of drugs, increased in the analysed period at similar rate (type 1 – 22,7%, type 2 – 22,1%). The highest costs are associated with treatment of diabetes complications. The total cost of treatment of DM showed in the analysed period an upward trend. The indirect costs are mainly determined by loss of productivity, cost of pensions for incapacity for work and cost of rehabilitation. The number of diabetic patients receiving pensions for incapacity for work is declining, but this trend is being seen in the whole disability pensions system in Poland.  CONCLUSIONS: From year to year DM causes a growing economic burden on the health care and to the Polish society in terms of health care and productivity loses.