OBJECTIVES: Assess the clinical and economic impact of pharmacist education, monitoring, and management of patients with diabetes mellitus (DM) enrolled in a free clinic that serves a rural indigent population. METHODS: Data from 77 patients continuously enrolled in a newly established pharmacist service were analyzed.  Patients were ≥18 years of age, qualified for free care on the basis of income and/or insurance status, and had a diagnosis of DM upon entry.  Under a collaborative agreement, pharmacists educated patients on DM, counseled patients on lifestyle modifications, assessed appropriateness of drug therapy, and managed drug therapy for DM and associated comorbid conditions.  Clinical impact was measured by changes from baseline in hemoglobin A1c (A1c) levels, blood pressure, and lipid levels over a 12 month period.  Using cost estimates published in the literature, economic impact was calculated based upon expected savings per 1% decrease in A1c levels. RESULTS: Mean A1c levels were 10.6% at baseline (SD ±2.5 %).  At one year, A1c levels decreased an average of 2.3% (P<0.001), and 44.2% of patients had an A1c ≤7%.  A significant number of patients achieved A1c goal by one year (P<0.0001).  Significant decreases in mean values were also noted for systolic blood pressure (SBP) (P=0.02), LDL-cholesterol (P <0.001), and triglycerides (P= 0.001).  A significant number of patients reached a SBP goal ≤130 mmHg (P=0.033), LDL-cholesterol ≤100 mg/dL (P<0.0001), or triglycerides ≤150 mg/dL (P<0.0001).  Based on an expected savings of $1,118 per 1% decrease in HbA1C levels, the average savings per patient was $2,600, for a total savings potential of $167,364. CONCLUSIONS: Pharmacist management of patients with DM has the potential to significantly impact clinical outcomes and improve costs of care for patients in underserved rural areas.