OBJECTIVES: To quantify the association between weight change, diabetes-related healthcare costs, and HbA1c among patients with type 2 diabetes (T2D); analyses were also conducted in sub-group of obese patients with no prior cardiovascular disease. METHODS: This retrospective, observational cohort study used U.S. insurance claims linked to laboratory and electronic medical records. Study included patients with T2D who were age≥18 years and added/switched to a non-metformin antidiabetes medication after metformin monotherapy between Jan-1-2007-Jun-30-2012 (add/switch date=index). Primary predictor was percentage weight change (PWC) between weight measurement at index and follow-up measurement 6 months thereafter ranging from negative (loss) to positive (gain).  Outcomes, measured in 12-month period beginning at follow-up weight measurement, included HbA1c<7 and diabetes-related healthcare costs. Multivariable models quantified the association between PWC (linear effect) and study outcomes. RESULTS: Primary analysis included 1,520 patients (mean age 55 years; 47% female); sub-group analysis included 780 patients (mean age 53 years; 51% female). Mean (SD) index weight and PWC were 224.6 (52.8) lbs and +0.2% (4.7%) in primary analysis; 241.3 (47.3) lbs and -0.2% (4.6%) in sub-group analysis.   Negative PWC values were significantly associated with higher adjusted probabilities of achieving HbA1c<7 (primary analysis: 58.8 % for PWC of -5% vs. 46.7% for PWC of +5%, P<0.001; sub-group 63.2% for PWC -5% vs. 41.7% for PWC .5%, P<0.001).  Increasing PWC was significantly associated with increasing diabetes-specific pharmacy costs (P<0.001) in primary analysis sample and with increasing all-cause pharmacy costs (P=0.018), diabetes-specific total costs (P=0.039), diabetes-specific medical costs (P=0.002), and diabetes-specific pharmacy costs (P<0.001) in sub-group sample. PWC was not significantly associated with all-cause total healthcare costs or all-cause medical costs in either sample. CONCLUSIONS: This real-world study suggests that short-term weight loss is associated with attainment of HbA1c<7 levels and decreased diabetes-related costs in obese population with no prior CVD over subsequent 12 months.