OBJECTIVES Estimate the direct medical costs of type 2 diabetes – related (T2D) complications in Mexican Ministry of Health's public hospitals. METHODS A complication – specific survey was designed to estimate resource utilization and procedures performed for T2D – related complications reported in the CORE model under the Mexican Ministry of Health (MoH) perspective. Three public – institution specialists were interviewed per complication. Costs were obtained from MoH hospitals official cost report for 2004 and discounted at a 3% annual rate. Only costs for Year 1 and 2 were considered. Results are shown as maximum/minimum costs for each complication in Mexican pesos (MXN). Cost of medications, prosthesis and cardiovascular markers were excluded. RESULTS The costs for cardiovascular complications were $121,496/120,157 (myocardial infarction), $179,680/175,818 (angina), $117,642/113,517 (congestive heart failure), $117,539/105,902 (stroke), $99,750/96,418 (peripheral vascular disease); ophthalmologic complications cost $42,852/42,593 (retinal photocoagulation), $14,318/14,318 (blindness), $124,370/124,370 (cataract operation); other complications cost $530,318/521,384 (chronic kidney failure), $17,849/16,692 (neuropathy), $133,048/132,799 (non-infected ulcer), $179,827/178,839 (infected ulcer), $96,411/96,411 (gangrene), $156,038/155,300 (foot amputation), $90,632/90,632 (ketoacidosis) and $69,208/69,160 (complicated hypoglycemia). CONCLUSIONS This analysis showed that the most expensive T2D related complications for the Mexican health system are chronic kidney failure, infected ulcers and angina. As diabetes prevalence rate is increasing rapidly in Mexico, public institutions should adopt cost – effective clinical strategies to avoid the financial burden of future T2D – related clinical complications.