OBJECTIVES: as a result of type II Diabetes Mellitus (T2DM), patient may develop several complications, which cause serious economic burden to health care system. The objective of the study was to evaluate the treatment cost of T2DM in Estonia for 4 serious complications: myocardial infarction (MI), stroke, nephropathy and retinopathy during the year, when the event developed and a year later. METHODS: anonymous data about T2DM patients´ treatment records was obtained from Estonian Health Insurance Fund for the years 2001-2011. The complications were defined by ICD-10 codes and following criteria were applied for the sample to be analysed: the complication had been detected first time between the years 2004-2008 (no complication during the preceding 3 years). The data did not include outpatient medication consumption. The control group consisted of randomly chosen T2DM patients, who did not have the complication during this time period. Data analysis was performed using Stata 11. RESULTS: the overall sample consisted of 3016 patients (age 45-69). Inpatient and outpatient treatment costs were calculated for MI, stroke, nephropathy and retinopathy for the year, when the event occurred, and for the year later. The highest treatment costs appeared during the year, when the event was recorded, and were for the MI 6,844, stroke 4,113, nephropathy 3,473 and retinopathy 598 EUR. A year later the costs were 1,860 (-73%), 2824 (-32%), 2490 (-29%) and 701 (+17) accordingly. CONCLUSIONS: MI and stroke are amongst highest costs during the first year and a year later the costs are lower, however for retinopathy the cost is higher than the first year. A year later, cost of stroke remains higher than MI, presumably due to follow-up care. The complication cost data obtained gives information about the healthcare expenditure in Estonia and can be used for cost-effectiveness assessment for new diabetes medications.