OBJECTIVES: The prevalence of diabetes mellitus is high among patients with developmental disabilities (cerebral palsy, autism, down’s syndrome and cognitive disabilities). Developmentally disabled individuals with chronic diseases experience delays in detection of comorbidities, poor disease management and low quality of care.  This study examines the racial health disparities in medication adherence and medication persistence in developmentally disabled adults with type 2 diabetes enrolled in Medicaid. METHODS: This was a retrospective cohort study based on a combination of the Health belief model and Aday Anderson’s model of healthcare utilization. The dataset used for this study was the MarketScan® Multi-State Medicaid Database.  Adults aged 18-64 years with a prior diagnosis of a developmental disability (cerebral palsy/autism/down’s/cognitive disabilities) and a new diagnosis of type 2 diabetes enrolled in Medicaid from January 1, 2004 and December 31, 2006, were included. Adults were included if they had a continuous enrollment for at least 12 months and were excluded if they were dual eligible. Anti-diabetic medication adherence and diabetic medication persistence were measured using multivariate logistic regression and the Cox-proportional hazard regression respectively.  RESULTS: The study population comprised of 1529 patients. After controlling for covariates, African Americans had 24% lower odds of adhering to anti-diabetic medications compared to Caucasians. (OR = 0.76, 95% CI = 0.59-0.98, p < 0.05).  African Americans on the other hand, were more persistent in taking their anti-diabetic medications compared to Caucasians. (Hazard Ratio = 0.97, 95% CI = 0.87-1.07, p < 0.606). CONCLUSIONS: The needs of the developmentally disabled individuals are somewhat different than the needs of individuals without disabilities. Policy recommendations should focus on increasing the number of outpatient centers as well as primary caregivers who can understand the disease management needs of the patient and accordingly collaborate with other specialized health care professionals to enhance the overall quality of care for the patient.